Pontifications: Boeing in Washington: Here We Go Again

By Bryan Corliss

Sept. 7, 2020, © Leeham News: Stop me if you’ve heard this one: the pundits are saying Boeing is going to leave Puget Sound, leaving behind the hollow husk of a company doomed to wither and die on the vine.

Bryan Corliss

Just like they did in 2003, in 2009, in 2013 and 2016.

Seattle-area political economist and author T.M. Sell, in fact, traces the company’s first threat to leave clear back to the 1920s, when company executives got into a fight with the Seattle City Council over building new roads to connect downtown with the airport we now call Boeing Field. 

Boeing said it would pack up and move to southern California, if Seattle didn’t cooperate. 

“Like rain in winter, this is a regular feature of the Puget Sound emotional landscape,” Sell opined back in 2009.

Here we go again

Of course, Boeing actually did move a big chunk of the 787 program to South Carolina in 2009, making North Charleston the second home of Boeing Commercial Airplanes. Now, the smart money is betting that as Boeing slashes 787 production rates to match cratering demand, it will consolidate that production in Charleston. 

In the past, this kind of thinly veiled threat would have driven a Pavlovian response: the state’s Democratic governors, living in mortal fear of being branded by Republicans as “The One Who Lost Boeing,” would form a high-level task force to come up with an emergency strategy to “land” whichever program was at risk (7E7, 737 MAX, 777X, NMA and now, potentially, the 787). 

The task force would come up with a recycled laundry list of initiatives: job-training, infrastructure improvement, regulatory streamlining, tax relief, and Gov. Locke/Gregoire/Inslee would ram it through the Legislature, then would launch new councils, offices or boards to implement the plan.

This is the last thing Washington state should do right now.

The thing is, the state of Washington already has most of the things aerospace companies need to be successful, especially in terms of workforce development. What it lacks – and very much needs at this moment — is a consistent, coherent approach to the aerospace industry, instead of another in a series of one-off crisis responses. 

Out-gunned, out-manned 

The Washington Office of Aerospace was created as part of Gov. Gary Locke’s “Project Olympus” deal with Boeing, which ensured the 787 would be built in Everett in return for the original $3.2bn tax break that Airbus and the European Union objected to.

But since its nominal creation, the office hasn’t had much of an impact. The state’s Legislature, at times, has failed to fully fund it – or even fund it at all. Directors of the office have cycled through after short tenures, leaving for better-paying, better-funded roles.  The most-recent director lasted barely 18 months before he quit – not in a huff, he said – over frustration with the lack of funding his office had to carry out its basic functions, like attending trade shows.

He left at the end of 2018. The position has been vacant since. The task of recruiting and retaining aerospace companies has fallen on three staff people at the state’s Department of Commerce.

There are several problems with this, and they all have to do with perception.

The room where it happens

Like most of the heavy hitters in business, aerospace industry CEOs have big — and often fragile – egos. They want to be catered to. They want to be seen and heard. And since they’re captains of commerce, they want to deal with equally high-ranking players from state governments. 

Robin Toth is the aerospace industry sector lead for the state’s Commerce Department. She is – by all accounts – well-connected and well-respected. Her background is in economic development in Spokane, which has a cluster of more than 100 aerospace supply companies – larger than most states. She is well-qualified for the role.

The problem is with her position. Toth doesn’t report directly to the governor – she reports to the state Secretary of Commerce, who is the one who reports to the governor. In corporate terms, she’s not C-level, she’s not even a senior VP. 

And what C-Level executive is going to bet the future of his or her OEM or Tier 1 supplier on the outcome of talks with the Washington state government equivalent of a corporate senior director?

Drowning in them

Despite that, official Washington does take aerospace very seriously, and there are at least a dozen major public and public/private programs to address everything from advanced technology research funding to workforce development: the WATR Center, AJAC, JCATI, the WAP, the EASC, INWAC, the WSBCTC and its affiliates like EdCC, EvCC, RTC and CCS – even the OSPI through the auspices of ESDs like Sno-Isle. 

And if you just got lost in that alphabet soup, you see the problem. There’s no one-stop shop for an out-of-state aerospace exec to email for site-selection data or information on entry-level training centers or apprenticeships to train high-skill workers. 

Even in-state companies can be confused: Some community colleges offer flight-line maintenance programs, while others teach machining and manufacturing skills. Which one should I call? Where is the FAA Center for Excellence in composites? And what about that thing my neighbor’s nephew is doing at his high school, where he’s learning basic aircraft assembly skills. Who do I call about that?

A Governor’s Office of Aerospace could – and should — be the clearing house for that kind of information, while also serving as coordinating body to avoid duplication of efforts and ensuring that the needs of both industry and job-seekers are being met.

Who tells your story?

Part of Washington’s problem in competing for aerospace jobs is that it has never had a consistent message or messenger talking about all the things the state has done to make the aerospace industry successful: some of the nation’s cheapest energy, dozens of training programs and a constellation of suppliers in Tiers 1 through 5. 

But do you ever hear about that? No. And that’s in large part because Boeing does a very effective job of communicating its dissatisfaction with the various elements of doing business in Puget Sound. (Ie., its unionized workforce, the high wages it must pay to attract local talent away from Amazon and Microsoft, snarled traffic that disrupts shipments between plants, the unions, the weather, and did we mention the unions?) 

And this pays off in times like this, because Boeing doesn’t have to make any public demands – everyone already knows what Boeing wants, so it’s just a matter of negotiating how much we’re willing to give. 

Washington needs to make itself part of the narrative. It needs an evangelist who can make the case that – as much as industry players complain about business conditions in Washington state – companies have made a whole lot of money here. 

And if Washington can’t figure out how to make its own case for why it’s the best place for Boeing to be building jets, states like South Carolina, Texas – maybe even Utah – will gladly tell Boeing executives all the reasons why it isn’t. 

A couple of college credits 

Then there’s higher education. As Scott Hamilton noted last week, the University of Washington hosts the well-regarded (but small) William E. Boeing Department of Aeronautics and Astronautics. 

There are also aerospace-related programs at just about every one of Washington’s four-year state schools: from materials science to manufacturing technology to aerospace-specific software code writing.

But if you’re an out-of-state company looking to recruit here, are you going to know that you’ve got to go to Eastern Washington University (17 miles southwest of Spokane) to find graduates of a specialized computer science program in aeronautical systems engineering? Or that you can find graduates who’ve studied composites manufacturing in both the far northwest (Western Washington University) and far southeast (Washington State University) corners of the state? 

The state’s higher education system needs to do two things – both of them relatively low-cost and (to a non-academic outsider at least) not all that complex: 

  1. Put together one website with information about all the options for aerospace-related engineering careers at all Washington universities, with separate contacts for prospective students and employers and;
  2. For the love of Mike, rebrand the aerospace department at UW to make it the William E. Boeing School of Flight. Remember how we talked about perception? Having a School of Flight named after Boeing’s founder at the state’s premier university shows commitment. 
Who lives? Who dies?  

It may seem inevitable that Boeing will move the 787 line to North Charleston, and with the end in sight for the 747 – and the 777X market getting squeezed – then the end is nigh for Boeing in Everett. And when 737 MAX production runs out, that will be the end of Washington’s aerospace industry

However, Hamilton argued (and I wholeheartedly agree) that all that empty space in Everett represents a great opportunity. Nature abhors a vacuum – and Wall Street abhors bad ROA ratios. The fact that Boeing’s next new aircraft program could move into an existing site surrounded by North America’s biggest pool of trained labor, with all the necessary infrastructure, clearly makes Everett and Renton the low-cost, low-risk option for home of the Next Boeing Airplane, whatever that turns out to be.

That doesn’t mean Washington can count on Boeing management in Chicago to do the smart thing.

Let’s get serious

If Washington is serious about maintaining its status as home to North America’s premier aerospace cluster, Gov. Inslee needs to rebuild the Office of Aerospace as its own entity, reporting directly to his chief-of-staff. 

And the state somehow – in Covid-dominated budget-writing session where red ink will flow like fake blood in a ’90s slasher movie – must come up with enough money for this office to adequately do its job. 

This is not an easy sell. For all its complaints about its unionized workforce, Boeing used to be able to count on the Machinists (especially) and SPEEA to lean on recalcitrant Democrats. But after spending the past decade at war with its workers, it’s hard to see the unions rallying to management’s side.

Likewise, Gov. Inslee has talked about how he felt “mugged” by Boeing during the 777X site selection process. How excited will he be to help a Fortune 500 company that in the short term is going to be slashing jobs in his state?

Washington needs to do this, however. Tech industry jobs (Amazon, Microsoft) have changed the economy and culture of the Seattle area with their six-figure entry-level salaries. But the aerospace industry remains a major pipeline into the middle class for blue-collar workers. 

If Washington is to remain a place where people can get out of poverty without a college degree, it needs to maintain a vibrant aerospace industry. Retooling the way state government relates to the industry would be an important step in that direction.

Bryan Corliss is a writer for Leeham News. He previously was a spokesman for IAM 751 and covered the aerospace industry for many years for the Everett Herald.

101 Comments on “Pontifications: Boeing in Washington: Here We Go Again

  1. A really good and interesting article Bryan. Great work to explain all the (variable) variables in a seemingly unsolveable equation of politics and economics!!

  2. Why all the drama about unions in WA?
    Airbus has to contend with unions in all the European countries in which it manufactures…it’s not the end of the world.

    And what guarantee is there that Charleston will forever remain union-free? Things change. Up to 5 years ago, Ryanair enjoyed union-free conditions throughout its network, but that started to change 3 years ago after a spate of strikes and bad press, and it now has unionized personnel in multiple countries. Guess what…it’s still flying.

    Sure…unions are a drag if you’re a manufacturer or service provider. But taxes and regulations are also a drag, and yet perfectly survivable.

    • The message needs to be flexibility with the Unions, they are also an asset.

      It was the Unions workers who figured out how to put a 787 together.

      Engage with the Union full time, make clear goals and respect the workers.

      Cowering workers do not respond well to management.

  3. Interesting insights, thank you.

    It might be interesting to recognize aerospace has become a truly global business. Local people, education, supply chains, engineering, subsidies, manufacturing, assembling might not be the reality of the 30 years ahead. And Washington no an exception.

    Maybe the time has come to reset some basic assumption & starting points. Civil Aerospace people, supply chains, design, education and dynamics are less tied. They’ll move to better places before you know. Today the #1 OE is based in 7 countries, dozens of nationalities work there, educated in dozens of other places.

    Maybe “William E. Boeing School of Flight” unintentionally sends an “old school” message to the well educated, brilliant young engineers from Delhi, Stuttgart and Rio you need in your aerospace clusters to stay relevant.

    Washington definitely has some strong points in terms of welfare, opportunities, climate and aerospace legacy. But have you ever been to Toulouse, São Paulo, Shanghai? Pretty vibrant places too, for young professionals to stick around for a number of productive years. Non technical, quality of life attractions are crucial IMO. Excel there.

  4. Does Boeing still own the place in Long Beach where McDonnell Douglas made the MD-80s, DC-10s and C-17s?

    • Long Beach, per Wikipedia: The economic base has changed over the years. Oil extraction created a boom and Long Beach was a Navy town for many years before the base closed.[56] The aerospace industry played an important role. Douglas Aircraft Company (later McDonnell Douglas and now part of Boeing) had plants at the Long Beach Airport where they built aircraft for World War II, and later built DC-8s, DC-9s, DC-10s, and MD-11s. Boeing built the Boeing 717 until 2006 and the C-17 Globemaster III strategic airlifter plant is scheduled to close. Even after greatly reducing the number of local employees in recent years, Boeing is still the largest private employer in the city.

      • Thats out of date for Long Beach, Boeing isnt listed even in the top 10. Thats what you would expect as the C-17 plant was listed for sale 2 years ago, but some buildings on other side of airport might still be with Boeing. Maintenance and upgrades of the C-17 are done elsewhere. The greater LA area the Boeing facilities at El Segundo are centered towards space
        vehicles,satellites and rockets with other facilities at Huntington and Seal Beaches- although the large Huntington Beach site is being wound down too.

    • I know as of 2017 it was home to a main distribution center for Mercedes Benz for either the west coast or the US. I assume it is a lease and Boeing still owns the site, but it’s unknown if it could be reactivated as a production facility. They also have some offices next to LAX but a production ecosystem would have to be rebuilt from the ground up most likely. Given that the highest volume products from there were the MD80s, I’m not sure it could sustain a rate above something like a NMA type plane.

      • Sub assemblies come from all over now. Even in the days of the DC-9 and DC-10 the wings came from Toronto. A final assembly plant doesnt need anything made fully on site.
        Look at Renton, only the wings are assembled in jigs on site from the parts that are made in Frederickson, south of Tacoma and as everyone one knows the fuselages are railed from Wichita.

  5. The state of Washington will slowly recover from Covid19 and a vaccine will eventually reduce the effects on the citizens.

    However- IMHO- the only vaccine needed for Boeing is to remove the MDC strain of the Neutron Jack Welch GE virus which is still rampant after over 20 years from the initial infection.

    The GE virus is easily identified by empty facilities and high cost corner offices.

    The McKinsey Company variation is especially resistant to common sense sanitation efforts.

    Herd immunity is unlikely to affect the lemmings.

    Maybe SpaceX can find a use.

  6. “Now, the smart money is betting…”

    I say that some days financial pundits are almost as bad as media people. Are you being facetious in using the word ‘smart’?

    ““Like rain in winter, this is a regular feature of the Puget Sound emotional landscape,” Sell opined back in 2009.”
    Ayup, media like to be that, flappers abound, politicans pander to them, unions get into the trough, ….

    As for WA state’s approach to aerospace, history shows the obvious proper approach is to stay out of business, quit meddling. Including recent history of the tax subsidy or whatever the goody given to Boeing was.

    WA’s history is like elsewhere – all many of organizations whose only achievement is to provide jobs for Executive Directors and staff. Vancouver Island’s SIPP couldn’t even proofread its glossy report, yet spent a full page on eye candy for heterosexual males, then proceeded to blather gobbledygook that even a collectivist media publisher criticized.

    The proper approach of WA state would be to protect people – look at unsafe conditions in Seattle now, enabled by Marxist council persons like the mayor, and stop local fiefdoms from blocking people’s productive

    Boeing had two production centers, but look at what’s left in The People’s State of California where employees were begging employers to move them out of California’s high costs and social problems.

    Voters? It’s up to you to elect stewards not control-minded freeloaders.

  7. As for Renton:
    – prime real estate thus pressure from politicians to develop for housing or park
    – very old buildings
    – short runway
    – not much activity beyond Boeing (small GA but while convenient GA tends to go out of town to get lower costs and less heavy traffic, such as Arlington WA and Snohomish WA and perhaps Kent WA IIRC had a small runway, I don’t know if business operators and couriers use it Renton)

    Oh, and East Marginal Way/Boeing Field (aka King County International):
    – many very old buildings, some fairly new
    – is an active airport for business operators and courier air freight, last I noticed
    – better runway (heavies in and out of their frequently for Boeing flight test)
    – but prime real estate thus pressure from politicians to develop for housing or park

    • Did you mention that Boeing has already moved HQ to Illinois? I must have missed it.

      Give it up. The “decision process” is over. Who wants to put up with idiots like Inslee & Sawant?

      Besides, it doesn’t drizzle constantly in SC, and the people are friendly, no “Seattle Freeze.”

      As for those new engineers? Single in Seattle, transfer to SC for a cheap house and a no-CHOP-BS to raise a family.

      • The HQ for Boeing Commercial Airplanes, with 1000s of employees is still in Seattle. The office in Chicago is for the vast Boeing conglomerate and has only 700 or so mostly corporate finance staff. Just as many Boeing staff in …Maryland while they had 7500 in South Carolina.

      • Well lets just hope those alligators don’t chomp on the kidees.

        Or the floods from the Hurricanes.

        Its a swamp, aka Low Country, and you know about sea level rise?

        Of course when the Runway froze in, nope, no one responsible to clean it off.

        You get what you pay for.

      • Like everything else in the socialist governments of Seattle and Washington State, they’ll ignore the loss of Boeing and Amazon until (surprise) there’s no more money in the piggy bank. Then they’ll somehow claim it was Trump’s fault, raise taxes (again) and, unbelievably, ask for your vote so they can give us more of the same. Get lnslee and the whole Seattle mob out while you still can.

        • Everyone: let’s tone down the politics. This is not about the national election, Socialism or other strains.

          Knock it off or I will close comments.

          Hamilton

  8. The world is changing at an accelerating rate and the Boeing C-Suite actors can’t keep up. Worse, not only are they not visionaries and leaders, but, given their age, they are stuck in the past and use the same ‘playbook’. Puget Sound aviation is going to be left to wither on the vine.

    • Me thinks the Vinyard has been set on fire.

      We used to call those folks Corporate Raiders.

      Now they are, well, Pillage comes to mind.

  9. Let’s just compare two eras at Boeing. The “old Boeing” developed new airplane models in 4 years, met performance expectations, delivered on time, had good safety and reliability records, prevailed in the market, regarded workers as valued partners, and made lots of money.

    In the current era, new models experience multi-year delays, rack up eye-watering financial losses, and put airline customers at risk. Boeing presses workers suppliers and communities for concessions, steadily cedes market share, and is slogging through a mind-boggling fleet grounding of its most popular model for well over a year.

    I’m not sure the spotlight should be on the State of Washington. The Board of Directors has one job – providing a coherent leadership strategy. Let’s have them do their job, then we can talk about how workers, suppliers, regulators, and communities can contribute to Boeing’s overall success.

  10. Trying to get back (perceived) yesterday as the way forward, probably is not the solution.

    Boeing had a kind of monopoly in civil, huge DoD orders, NASA R&D, subsidies, ExIm financing & protection from the government. And the culture, benefits that come with that.

    Now the competition have the better products and assembly in the US and China too. Take that as starting point.

  11. The underlying cause here is the reduction in demand, which is unprecedented and was not foreseen by anyone. This means that at present, there is significant over-capacity at both Boeing and Airbus, and together an over-capacity for the world.

    How to handle this is the key question. For the 787, it pits Charleston against Everett, since there is not enough production to sustain both. There is no upside to that decision, at best there is only loss, and the absence of loss. Therefore the choice will be between evils, and minimizing damage. A lot depends on how long the downturn will last, and at present we have only varying estimates of that.

    Boeing could choose to equalize the damage to labor at each location, by eliminating shifts and slowing the production rate at each. Also possibly using revolving shifts to maintain some worker income. In that case, some workers would voluntarily choose to move on. Boeing would still have the larger cost of both facilities. This might be workable in the short term, as an interim solution if the downturn is on the shorter side. It has the advantage of preserving the facilities investment, and also demonstrating Boeing’s overall commitment to communities for as long as possible. And it would provide an opportunity to improve quality control. But it might also only delay the inevitable, if the downturn persists, at much higher cost. It would be a substantial risk.

    They could also choose between the two locations. In that case there are multiple factors to be considered, and one or the other is going to be hurt.

    Looking at it from the damage perspective, Charleston would be more severely affected as they produce only the 787. Everett at least has other lines active. So unless Boeing could reorganize operations to move something else to Charleston, the outlook would be most bleak there.

    From a cost perspective, Charleston may offer the lowest cost because they already have the -10 tooling there, and labor costs are lower. However they also have the lower build quality, so that some transfer of expertise from Everett would be needed, perhaps in terms of employees.

    Everett has higher cost but also the most flexibility in facilities, and the higher build quality. But additional expense in moving or adding the -10 tooling, and perhaps transportation costs.

    It’s a tough decision and I don’t envy Boeing in making it. Whatever they decide, is sure to draw criticism from some quarter, and is bound to hurt people in some way.

    The notion that communities like Everett or Charleston can somehow alter the outcome, is probably not realistic. Both have been and continue to be acceptable to Boeing. Neither can solve the core problem, which is demand.

    The real solution is to restore the air travel market. People want to fly so it’s mainly about governments working together to reduce pandemic concerns and the need to quarantine. Vaccines will obviously help but there are other measures as well. However Boeing has no control over that, so will need to respond to the market as it exists.

    • The COVID-19 reduction of demand is the latest and hopefully a temporary challenge. This situation is bigger and was created long before. The 787 development drama, DOA, 737 MAX, KC46, 777X troubles, stock holder value driven strategy approach, reliance on Government have nothing to do with with Covid-19. No escape there.

      • As I mentioned, the reason for the production drop is the COVID-19 crisis. Prior to that Boeing knew it faced a long-term decision as the 787 production run slowed and ended. There was absolutely no expectation of being forced into making that decision this year. The decision was brought substantially forward by COVID.

  12. Keith Skechley calls it perfectly. The future of aerospace is finished in
    Puget Sound. Oh sure they’ll be little snippets of some leftover Boeing engineers, maybe flight test will stay, but Boeing like many companies here are fed up with the leftist politics. No new highways (West Seattle bridge anyone?) traffic gridlock and to top it off allowing thugs to block major highways and call it peaceful protest.
    I get tired of hearing that we have the best aerospace workers out here. Tell that to me who worked in quality and saw the major FOD and blatent defects daily. Seems Airbus found good workers in Mobile and Wichita still has 4 major aerospace manufacturers.

  13. Where is the Problem Really?

    Is there an office for Microsoft and Amazon to source talent?

    Give a 15 year old kid two weeks with a computer and a spread sheet and he could create your resource page.

    Or why does not Industry do so?

    Upshot is not matter what you do, Boeing is going to threaten to move ops anyway.

    Funny, Ford Built River Rouge and Willow Run all on his own little brain.

    The system is broke from the top down, that is where the change has to occur. Otherwise we have MAX, 787 failures, KC46 failures, the Space thingy Failures.

        • All discussed earlier. The inspections have to do mostly with the part tolerance issue, since the shim issue has a known cause and range of manufacture (discovered and fixed in 2019). FAA was notified of the shim problem at that time.

          • “Predicting shim gaps in aircraft assembly with machine learning and sparse sensing”- Journal of Manufacturing Systems
            Its based on Boeing processes and data.
            One acronym is called PIXIE Dust- no kidding. ( this will get some going)
            [PIXel Identification Despite Uncertainty in Sensor Technology ]
            https://www.sciencedirect.com/science/article/pii/S0278612518300116
            These arent Aerospace engineers , just your regular manufacturing mechanical engineers. But it seems that for ‘reasons’ , Charleston turned off some or one of parameters in the software.

          • This study was looking at reducing the optical data points required for shim prediction. It wasn’t a production process. They used actual production data as a test case.

            We may never know why the shim software notification feature was not used at Charleston. But since it wasn’t, for whatever reason, it’s another quality control issue.

          • It’s essentially irrelevant what the technical issue is, because two other questions are of greater relevance to the press and public:
            (1) How come other manufacturers didn’t suffer from this issue, and Boeing did?
            (2) How the heck could the issue perpetuate for years without being remedied?

            So, we can now call the “Dreamliner” the “Dreadliner”.

          • This is an anomaly and therefore not planned, for either Airbus or Boeing. It would not be expected for either manufacturer to have this problem, or for one manufacturer to have it because the other does, or vice versa.

            The issue as I said, is quality control. We don’t know for sure yet, but it appears the issues were on the Charleston line. The technical reasons are important in terms of understanding what went wrong, how it happened, and what the impacts are. We know that pretty well already for the shim problem, but not for the tolerance problem.

            It’s too early to form conclusions or assign derogatory labels, we need to see the scope of the inspections and the results. In the meantime these aircraft remain in service because they are considered safe, unless proven to be otherwise. The purpose of the inspections is to check and develop certainty.

          • Kind of like when the MAX turned into a lawn dart? That sort of safe?

          • The NY Times summed it up:
            “More than a year ago, a review by The New York Times of hundreds of internal and federal records and interviews with current and former staff members found a culture that emphasized speed over quality at Boeing’s plant in North Charleston, S.C., ”
            https://www.nytimes.com/2020/09/08/business/boeing-787-dreamliner.html
            There not much point in gaslighting the issues at Charleston as some minor events.
            The culture was speed over quality, and no wonder Everett could have an average assembly time ( based on 2019 figures) of 17 days while Charleston was around 22 days – the best plane would make 19 days.
            Boeing wanted Charleston to ‘speed up’ to match Everett and would have told the management so and management bonus pay would have been linked to targets that led to shorter times on the line.

          • We can connect the dots.

            Boeing and its infamous QM programs.

            Boeing and its undermining of the FAA by constant pressure in the ODA program.

            Reminds me of a Grounds Hogs Day Titanic. Same Captain, Same Ice Field, Same speed, sinking over and over and over again.

            These issues don’t just mysterious happen, they occur as a result of deliberately degrading of the system.

            No mystery, just the same o same o.

            At some point the house gets cleaned of the fleas and ticks.

          • No manufacturer could overtly emphasize speed over quality. That is an editorial conclusion by the NYT. The more likely scenario is that Boeing emphasized the need to improve production performance to be consistent with Everett, as Duke says.

            But it is not an automatic requirement that performance improvements diminish quality. If that were true, Everett would be producing a lower quality product, which we know is not the case.

            So there is another element involved, in terms of how the performance improvements were obtained. If they were done by lessening quality, then that is an obvious problem and a poor practice. But you cannot automatically assume that was the intent of management. I suspect they hoped to match Everett in both performance and quality, but ended up with process escapes at Charleston.

      • Bill Clinton at his finest of slicing and parsing a word.

        “Boeing engineers determined that while either one of the flaws alone was not a safety of flight issue, planes with both flaws could have compromised structural integrity and had to be grounded.”

        Of course if your tail breaks off then yes its a safety of flight issue.

        Same engineers that brought us MCAS.

        Of course I am installed with confidence.

        • That was a truthful and accurate statement. Also discussed before, as to why the combination could lead to structural weakness but either alone would not necessarily. The inspections will be able to confirm if a weakness exists that reduces the safety factor.

          Again, as mentioned in the other thread, no risk of tail falling off or in-flight breakup. That was made clear in both articles and the FAA would not permit continued flight if that was a possibility.

          • “”no risk of tail falling off or in-flight breakup. the FAA would not permit continued flight if that was a possibility.””

            If that was not a possibility, Boeing would never have self-grounded some 787.
            And the FAA … I’m not convinced they know what they are doing.

            A 787-10 MSN62685 which was delivered to ANA on 30 June 2019 is grounded. ANA has another 787-10 MSN62684 which is flying. Makes me wonder why it wasn’t grounded too, to carefully check the situation first.

            So MSN62685 was flying for over a year and nothing happened. There must be a serious damage cause Boeing grounded it now.
            Good to be lucky.

          • The reporting has been clear on this. For aircraft that have both issues cited, they could align and that could lower structural strength below the safety factor. So these aircraft were grounded on the basis of having both conditions, will be inspected and will have the issues addressed.

          • Sol we set tolerances per certification then we ignore them?

            Not one, but two different tolerances.

            This is a list of failed Generals in the Civil War

            McDowell, McClellan, Pope, Burnside, Hooker, and Meade.

            Its called accountability and you fire people until you find someone that acualy can manage.

            The Union Army was good, it had horrible leadership.

            Boeing can be good, it has incompetent leadership with one lame excuse after another.

          • Standards, specifications, tolerance, who needs those silly things.

            Throw them out with those stupid rules and our life is good.

          • Ted, things that fall off are only important when they fall off of other manufacturers’ aircraft.
            When they fall off a Boeing, it’s clearly the pilots’ fault.

    • “Safety and quality are Boeing’s highest priorities; we are taking the appropriate steps to resolve these issues and prevent them from happening again,” the statement said. “The U.S. Federal Aviation Administration (FAA) has been fully briefed, and we will continue to work closely with them going forward.”

      Check is in the mail.

      Perhaps we should be looking at Management Quality!

      What was the group that had the song “Dirty Laundry”?

  14. If a lot of 787s are now suspect/to be inspected/to be modified that might actually stroke demand for twin aisles – from Airbus!

    Is there no end to this Boeing Greek tragedy? We have a role in this play as the chorus predicting the unavoidable doom awaiting the protagonist, in spite of all his/it’s attempts to avoid it…

    • No, there is no end in sight.

      Its built into the Corporate DNA now.

      Like a gangerous limb, the only option is to cut off management and see what you can save.

    • You have to wonder if management has a store of this sort of thing that, oh, what the heck, while we are grounded anyway lets get it out of the way.

      How much more to come?

      The illegal removal of lightening protection has not been addressed yet either.

      • And likely will not be, since no allegation of that exists, outside of your continued statements to the contrary here.

      • In FAA’s world Boeing can do anything, like remove by himself some parts from certified design, until an aircraft crash twice.

        • Obviously untrue, since the FAA has fined Boeing repeatedly over the years for infractions. I’m sure they would not hesitate to do so again if they felt there was justification here.

          • You’re confusing action and reaction.
            The fact that the FAA EVENTUALLY fined Boeing (reaction) doesn’t mean that the underlying transgressions (action) were anything other than a disgraceful display of arrogance and recklessness (by Boeing) and lack of oversight (by the FAA). The MAX fiasco has revealed the overly-cosy relationship that existed between Boeing and the FAA. And now we discover that the FAA was once again asleep on the job with regard to QC on the Dreadliner…for a full decade.

          • Unfortunately true, because Boeing is not mending these aircrafts, which were not built to meet design. Instead they are paying some fine. Everything OK in Boeing’s world.

          • The claim was that FAA permits Boeing to do as it pleases. That is not true.

            Now the claim is that FAA uses the fine as a substitute for fixing the aircraft. That too is untrue, the FAA has never and would never do that. The aircraft safety is the first priority, punishment of Boeing is a separate issue.

            We don’t yet know the full scope of the impact, why it happened or was missed on inspection. The FAA is working with Boeing to establish this. I’m sure it will be reported when known.

          • And it happens over and over and over again.

            Houston, we have a problem.

            When its demonstrated byu action it going to repeat we just believe its not? Whoo baby.

            I guess that means I can start robbing banks as long as I say I am sorry I won’t do it again and I can keep the money.

            Get out of jail free card.

          • “We don’t yet know the full scope of the impact,”

            We know now, after so long time passed. B789s without lightning protection were nor grounded nor fixed. Just Boeing got the fine. FAA will be “evaluating” forever, until something happen.

          • Pablo, the Boeing 787 without lightning protection is an utterly false assertion. The protection on the 787 has been evaluated and found safe by the FAA. These statements don’t become less false by constant repetition.

      • The US stock markets were closed for the past 3 days (Labor Day weekend), and thus couldn’t react to this news.
        It will be interesting to see what happens to the Boeing stock price when Wall Street opens. This company can get NOTHING right.

        • Stock price has lost $4 today thus far, is down $9 since the news broke on Friday. So about 5% overall.

          • Well, it has lost 60% in the past 18 months, so I suppose the market has learned to deal with continuing disappointment.
            Still, give it a few days…once the dirty laundry emerges in somewhat more detail, things will probably go further downhill. I can’t wait to see what CNBC digs up on this…

        • Airbus has similarly lost 50%, most airlines equivalent or worse. It’s ironic that after all the criticism of Boeing’s focus on stock price, that’s what’s pointed to here.

          Boeing stock generally recovers as the problems are eventually addressed. That’s likely to happen here too.

          • Actually, Airbus is down 37% in the same period (18 months).
            Maybe not for you, but for the average investor there’s a world of difference between 60% and 37%.
            But then, of course, Airbus is only affected by the general market downturn, whereas Boeing additionally has the grounded MAX…and now even more problems with the Dreadliner, which is the only cash cow that it has left.

            And why is it ironic to point to what the stock market does? It’s an excellent indicator of the trust in a company, and in its prospects…or lack thereof.

          • MarketWatch shows 50% peak loss for Boeing, and 47% peak loss for Airbus. This is from the maximum price at year end, before the pandemic, to current price. Peak loss is a better measure of the fall in value. Airbus gained value in late 2019 but lost all those gains in 2020.

          • The 18-month period that I referred to dates back to the start of the MAX debacle. From that juncture onward, the Boeing stock price declined whereas the Airbus stock price initially advanced and then started to decline when the CoViD pandemic kicked in. Taken from that point, the Airbus decline is 37% and the Boeing decline is 60%.

          • The point was that the choice of period influences the perceived result. I could choose another arbitrary interval that would look more or less favorable.

            The peak loss measure eliminates that bias, it represents the true fall in value of each stock, from best recent performance (2019-2020) to current. Which as I mentioned, is similar for Airbus and Boeing.

          • I wouldn’t describe the start of the MAX debacle as demarcating “an arbitrary interval”…particularly not when it initiated an inflexion point for one of the stocks, with a subsequent essentially monotonic decline.
            But, as stated elsewhere on this forum, Boeing cronies will always window dress so as to try to achieve the least damaging PR result for Boeing.

          • Bryce, your selection of time period obscures the loss of all Airbus gains in 2019. This is clear if you look at the stock price history.

            It’s also clear that the dominant trend & impact, far and away, was the loss that occurred due to the pandemic, for both companies. So that is the most relevant metric here.

            You constantly imply bias, and do so with snide remarks, but your long history of commentary here has been consistently derisive of Boeing. You constantly predict, anticipate, and root for their failure. Your true motives are easily identified by those traits.

            You’ve generally been wrong in those views. This discussion began with your fond hope that Boeing stock would now drop precipitously. I correctly pointed out that the drop was very mild. So again you were wrong in your assertion, mainly because you were hoping for the worst, instead of considering more rounded viewpoints.

            Accusing others is a common deflection strategy, and is part of the weakness I mentioned. The most biased people will also be the most incapable of seeing their own bias, the most unwilling to consider any other tempering point of view, and therefore the least capable of learning from their mistakes. You are by no means the first or only example of that.

      • And now the news we were waiting for: additional problems with 787 empennage assemblies affecting “hundreds” of planes… Which FAA is”evaluating”.

        Well, if 797 are grounded As a result airline may need to pull 767s out of storage.

        • Yes, Boeing’s audits are turning up quality control problems, one after the other. The number of them, as well as the spread in locations (this one in Salt Lake), more or less confirms it’s a cultural issue.

          The fact that they are actively looking, and self-reporting, may indicate there is awareness of the problem and efforts to improve. But we have to see how all these things turn out over time to know if there is real progress. There has to be more than just putting out fires, the fires have to not get started in the first place.

          In this case it appears to be over-tightening of the tail section components when clamped together during assembly, which stresses the structure and may lower fatigue life, as well as create another potential gap problem. The tolerance exceeded is again 5 thousandths of an inch.

          • If Boeing had quality control (not the infamous QM) then they would find nothing on their audits because an issues would have been found when they occurred.

            I know its a shock, but quality control is to close the barn door before the horses bolt, not after.

            Lets just keep ramming the iced beg at 20 knots and see if something changes.

            Its not the details that matter here, its the gross failure of quality control of which Boeing has none. Stuff just happens.

  15. After the 737 winds down at Renton in about 2035, I don’t see why Boeing would stay there. The reasons being the same reasons that every commercial aircraft was once produced in Southern CA and now none are, congestion and cost of living. I wouldn’t be surprised if the airport was closed as well and redeveloped for something else.
    Everett has the possibility to get a new program. In the mean time, that leaves a few years of 747s, and maybe 200 767s and 300 777s until there is minimal production in a decade. But the Everett airport is sure to grow and most of the space can still be used for aviation maintenance. More space means more options to build a major airport terminal, which is a large economic driver.

    • If it was open land they could have started shifting to Moses Lake.

      Spokane to the West, Euprhata/Wenachee to the East, lovely county to the North.

      Get in the right zone and power is cheap (legacy from Grand Coulee Damn)

      Its all about corporate welfare though, not location.

      Having been through Charleston, ungh, its a swamp next to a Hurricane Stream.

  16. Seeing as there’s currently a glut of ordered twin-aisles that airlines would love to rid themselves of, it will be interesting to see if the latest QC news results in a spate of cancellations for the Dreadliner. We already know that Qatar Airways refused to take further Dreadliners from Charleston…will other airlines now follow suit?

  17. It sounds a mess, disorganised and lacking clear, focused leadership.

    But…

    Any school worth its salt will have worked connections with relevant employers and trade bodies without needing to go through any government department. And any substantial business already in WA and worth its salt will likewise have researched which schools produce the grads it needs and worked connections with them. Smaller businesses may have done this directly but may also have connected indirectly through higher tiers.

    Beyond this the local trade assoications are really the bodies that should be speaking regularly with schools, letting them know what they need. No need to route it all through yet another layer, government or otherwise.

    The role for the government aerospace office (and I do think it should stay aerospace. Flight, as suggested for one of the schools, feels outdated and too narrow) should be to point incoming business to the trade body but much more it should be to do what only it can do, to strategise and implement broad infrastrcuture, employment environment, living environment etc.. Listening. Agreed it needs to be top level, not as low as it currently is.

  18. It’s a great decision to bundle production at the lower quality factory.
    Makes absolute sense, Toulouse is having a party.

    It wasn’t a good decision to move the headquarter to Chicago, though it looked like cost wise.
    It’s the same kind of decision now.
    Cost driven decisions often underrate soft factors, and this is.
    Chicago doesn’t want union influence. Boeing is acting following ‘divine e empera’ – nothing better than having 2 production sites in different states on the opposite cost to match and compete with each other.

    But Boeings drive to cut costs, mainly construction costs have lead to disaster already. The B787 did completely run over budget, time and has the quality issues from Charleston. The Max suffered from a strategic mistake and the cheap & fast approach at all costs.

    Look at Boeing and it’s the position now.
    Its civilian aircraft division is now a single-family one, worse, it’s only a B789 and B78X division.
    The Max is grounded and might have permanent reputation damage. Another crash and it’s toasted.
    The B777x is already in trouble. With its first delivery at least 18 months ahead.
    The B747 is gone finally.
    The B767 won’t run forever, and the tanker is still a pyrric victory.

    • “”It’s a great decision to bundle production at the lower quality factory.””

      Remember when people talked about maint having low standards in Indonesia and Ethiopia.

      From the 2008 Airbus internal Boeing brief about the 787:
      “”Airbus cites Boeing’s challenges, beginning with the production across the whole of its supply chain, believing that the early issues originated in a lack of oversight on design and assembly integration for the high level of outsourcing.
      Airbus: this was exacerbated by “low-wage, trained-on-the-job workers that had no previous aerospace experience” working at supplier partners. Airbus believes “inadequate supplier capability in design” contributed further, citing as an example that “Vought had no engineering department when selected” by Boeing.
      With the pressure to expedite pre-assembly growing, Airbus believes Boeing and its partners chose to defer “non-destructive inspection [NDI] from its tier-2 and tier-3 suppliers to tier-1 partners”.
      The situation was only made more complicated by the additional deferral of NDI from its tier-1 partners directly to Everett to rush major assembly.””

      flightglobal.com/airbuss-boeing-787-internal-brief-exposed/84227.article

  19. Stab issue on the 787.

    According to Boeing, parts of the horizontal stabilizer were clamped together with greater force than specified during assembly. This could cause gaps between parts in the stabilizer. These gaps could potentially be wider than the five-thousandths of an inch that’s allowable in the specifications. It could lead to premature aging.
    The problem could affect nearly 900 787.
    The horizontal stabilizers were manufactured in Salt Lake City.

    https://simpleflying.com/boeing-787-horizontal-stabilizer-issue/

    • Yeah, the same issue with the horizontal stabilizer was reported yesterday on Reuters and CNBC also.
      This is the juncture where a well-known Boeing mole here will jump in and try and do the usual damage control by telling us that “these are the results of routine audits…nothing adverse has been proven yet…investigations are ongoing…the planes are still perfectly safe to fly…the issues are mere unexpected anomalies rather than systemic faults” and other such hot air. That type of behavior seems to be endemic to Boeing cronies: remember how the previous CEO told us on a weekly basis that the issues with the MAX were now fixed, and that the plane would be re-certified “next month”?

      • He might have hid some information.
        I was wondering about a 1/5000 of an inch margin for a fuselage with 6m diameter.
        The 1/5000 margin might be related to the stab, not fuselage.

        Rob, tell us what comes next.

      • My position was outlined yesterday above. It’s yet another challenge for Boeing, and example of self-inflicted damage. But they will address these problems and move forward. The real question is whether they are rooting these out so as to identify the issues and prevent them in the future. That cis what’s needed, and can only be seen with time.

        The “mole” and “crony” comments discredit you, Bryce. And yes, I will call you by your name, having no need to be less than direct and straightforward, or to imply disparagement or insult to justify my arguments. You may not like my views and that’s fine, but deriding others rather than providing evidence to oppose their viewpoints, is a sign of immaturity and weakness.

  20. “”Boeing engineers spotted the problem back in February. Boeing self-reported to the FAA. But it’s only in the last week that senior FAA officials became aware of the problem.””

    Sounds familiar … remember when they inceased the degrees on MCAS … they told some FAA folk too.
    But it’s not the right way to inform the FAA. You can’t report serious matters to the FAA and send the letter to the doghouse in the garden. Letters need to be sent to the front office. SMH
    It seems it is Boeing’s intention to do business this way.
    Calhoun in February …

    Must be easy for Norwegian lawyers.

    • Ups, half a year untill they simply be aware in all FAA of the problem? :/ Everything OK in Boeing’s world…

    • Leon, it’s more likely that the issue when first reported, didn’t rise to the level of senior management, not being an imminent safety of flight issue. Regulators produce numerous repair bulletins every month, that address issues below the level of unsafe conditions.

      Now, though, in conjunction with the two other problems associated with the tail, the investigations are merged and it would rise to that level. As I mentioned earlier, each issue is actually 2 problems, failure in workmanship and failure in inspection.

      Boeing had acted over the last few years to increase digital monitoring of tooling and decrease physical inspection. That will likely come under scrutiny now. Critics at the time said that the digital techniques would under-report flaws, and that would seem to be substantiated now.

      Under Boeing’s guidelines for the new system, a quality drop below 95% would trigger increased physical inspections. But if the flaws are not discernible to the digital methods, then the trigger never occurs, and the flaws survive. We don’t know yet exactly what happened, but that explanation would be consistent with the facts.

      It may be that the digital methods should be more of an augmentation of inspection, than a replacement. The idea of tool monitoring is fine, but it has limits.

      • Another big quality issue with B787.

        FAA: nothing new, let’s go sleep, no need to alarm.

        In case of proper regulatory supervision all red lights and alarms should be ringing from the start.

  21. Now, the quality issues on the 787 seems serious.
    Why would I want to buy 787 if I already ordered it?

    The Seattle Times quotes an unidentified FAA engineer saying;
    “Grounding airplanes for manufacturing flaws is unprecedented and unbelievable.”

    • Not at all…no need to worry…these are just the results of “routine audits” 😉

      You can be sure that this is a field day for lawyers at airlines that want to dump their Dreadliner orders. All that’s needed now is evidence that Boeing knew about the problems earlier but tried to keep the lid on them…then we’ll have fraud in the equation, and that’s always a good interjection when trying to pull out of a contract.

    • I think that comment will be valid if this turns into a mass grounding. Right now there are 8 aircraft grounded, out of just under 1000. Individual aircraft are grounded for repair issues at times. Also for engine issues, as we know. It all depends on the scope of what is found by Boeing and FAA.

  22. Can anyone answer the pivotal question? How much does it cost to produce a 787 in Washington and how much in SC?
    If the answer is that in SC is a lot cheaper, lets say, 5-10 millions less per plane, then WA factory has a bleak prospect. If not, I think it can have some future.

    • @Miguel: In 2017, a Boeing SC official told me Chicago concluded the FAL at SC was 20% more efficient than Everett, but the cost of the production process before FAL was more costly in Charleston. No specific numbers were provided and the net-net wasn’t either. This is the closest I’ve ever heard to comparison.

      Hamilton

      • I will also everyone to question Corporate, they do cook the books to make their choice look like its got some basis of facts.

        I’ve seen it in person.

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