Boeing faces exodus of senior engineers in tight market for talent

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By Bryan Corliss
Nov. 28, 2022, © Leeham News: Boeing’s engineering corps could become further depleted within the next few days, as union-represented engineers and technical workers at the company’s Puget Sound plants face a Wednesday deadline on filing their retirement paperwork.

If they don’t leave now, individuals could face retirement benefit losses in the hundreds of thousands of dollars.

The potential loss of several hundred of Boeing’s most experienced engineers comes at a time when the company is scraping together engineering teams to tackle production problems in Charleston, and in the midst of an industry-wide shortage of engineering talent.

Summary

  • Aggressive hiring sparks Brazilian lawsuit
  • Engineers face Wednesday deadline
  • All aerospace companies need engineers
  • Tech industry layoffs won’t help
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Pontifications: Boeing spending millions to retain engineers

May 16, 2022, © Leeham News: Boeing is spending millions of dollars to retain engineers represented by the union, SPEEA.

It’s a reversal of efforts to trim SPEEA ranks through early buyouts and outsourcing and to address an aging workforce.

By Scott Hamilton

The proposed 2017 joint venture between Boeing and Embraer was meant to address the retirement crunch. But delays in clearing the JV by the European Union and then the Boeing 737 MAX crisis and the global COVID pandemic killed the deal. Boeing walked in April 2020, shortly after the pandemic began. Officials claimed that Embraer failed to meet all the terms and conditions outlined in the documentation. Embraer denied this, claiming Boeing’s self-inflicted MAX crisis was the reason Boeing walked. The companies are in arbitration over a $100m break-up fee. With the collapse of the JV, Boeing lost access to Embraer’s young (and less expensive) engineering workforce, the No. 1 reason to do the joint venture.

“There is a big push to keep people,” SPEEA tells LNA. “Boeing is using raises, restricted stock, and incentive bonuses to keep engineers. Our contracts called for $7m in out-of-sequence raises last year and the company spent $22m.”

Boeing is more than a year away from clearing its inventory of 737s and 787s. Until then, or until the end is definitively in sight, it’s highly unlikely that Boeing will launch a new airplane program. But there are five 7-Series airplane programs that engineers and others are working on: the certification of the 737-7 and 737-10 this year and next; the development of the 777-8F; and increasing the gross weight of the 787-9 and -10. Certification of the 777-9 is also outstanding. Nothing official has been said in detail, but changes to the airplane demanded by regulators may require engineering work.

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2024 will be key year for Boeing in Washington

This is the second in a series of articles examining how labor, Boeing and Washington state could move forward following the COVID pandemic. The first article is here.

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By Bryan Corliss

Analysis

Introduction

Nov. 30, 2020, © Leeham News — You might want to set yourself an Outlook calendar reminder for January 2024.

It’s going to be a pivotal year for Boeing, its home state and its workforce. By then, the company’s recovery from the current Covid-caused crisis should be underway, with the order book refilling.

The countdown should be on for the long-delayed roll-out of the reconceived NMA, at long last giving Boeing a real counter to the Airbus A321. And — barring a surge in 737 MAX orders after its return to service — Boeing could be close to making some tough decisions about the future of the 737 program, thinking hard about whether after 60 years it’s finally time to design and build a clean-sheet replacement.

Also by then, the 787 program will have fully consolidated into Charleston, and the last 747 will have departed the Paine Field flight line, leaving The World’s Largest Building (By Volume) half-empty.

Then, in January 2024, Boeing’s contract with its touch-labor union – IAM District 751 – will expire, after a 10-year extension that was part of the price Machinists paid to ensure the 777X would be assembled in Everett. For the first time since the summer of 2008, the two sides will sit down at a bargaining table with the union having the ability to call for a strike.

What happens between now and January 2024 will pretty much decide the future of Boeing in Washington state. If the players are clear-eyed and rational, we could see a return to the days when high-skilled workers built high-quality planes that created handsome profits for Boeing shareholders and family-wage jobs for Boeing workers.

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Pontifications: Why I’d fly the MAX; lessons learned and still to come

Nov. 23, 2020, © Leeham News: I’m okay with flying on board the Boeing 737 MAX.

Yes, it’s gone through the wringer in the 20 months since it was grounded.

Yes, Boeing and the US Federal Aviation Administration screwed up royally.

And yes, there’s solid reason to distrust the company and the agency, wondering if they got it right this time.

Which is why for me the tipping point is the involvement of Transport Canada and Europe’s EASA are the reasons to trust getting back on the MAX.

LNA addresses the safety in our new podcast feature, 10 Minutes About. The inaugural podcast, 10 Minutes About the Boeing 737 MAX recertification may be heard here.

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Boeing, unions need reset: analysis

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By the Leeham News Team

Analysis

Introduction

Nov. 16, 2020, © Leeham News: Boeing is at a defining moment, says John Holden, the president of IAM 751. This is the labor union that assembles Boeing’s airplanes in Washington State.

The Seattle Times wrote that “Boeing must realign for better days“.

Neither said anything that hasn’t been said before, some of them repeatedly.

There is a new twist to it this time.  Boeing is seriously bleeding money.  It is making changes for survival and paying a horrible price as it loses talent that takes years to develop.  There are many losers here:  Boeing, Washington State, Snohomish, King and Pierce counties, Everett, Renton and all the communities in the Washington Aerospace heartland.  There are no winners.

But for all the points identified, few offer solutions. What should a realignment include?  What could it look like?

Over a series of articles, LNA will examine some possible solutions.

The first is Labor, starting with the IAM 751.

Summary
  • Long, tortured relationship.
  • Strong union state.
  • “Expensive labor.”
  • Is there a “value” premium?

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Retrospective-2, 10/29/09: 787 Line 2 aftermath

DownloadRetrospective-2, Oct. 1, 2020, (c) Leeham News.
This is the second in a series of Retrospective looks at the 2009 decision by Boeing to locate 787 Line 2 in Charleston (SC).

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Retrospective-1, 10/28/09: Boeing to Charleston for 787 FAL #2

DownloadOct. 1, 2Oct. 1, 2020, (c) Leeham News: 10 years, 11 months and 27 days ago, Boeing announced it selected its production plant in Charleston (SC) for the site of its second 787 assembly line.
The decision came after an intense battle with its touch labor union, IAM 751, over concessions demanded by Boeing and offers made by the union.
Boeing told Washington State there were no incentives that could be offered to persuade Boeing to locate Line 2 in Everett (WA). The issue, Boeing said, was entirely about the union. However, it was later learned South Carolina state and local governments provided Boeing with nearly $1bn in tax breaks and other incentives to locate Line 2 there. State and local Washington officials felt flimflammed by Boeing officials.
Last month, Gov. Jay Inslee of Washington asked Boeing if there was anything the state could do to persuade Boeing do keep Line 1 in Everett.
The company is meeting today to decide whether to consolidate the two lines into one to save money because of the COVID-19 crisis. When CEO David Calhoun announced a study during the 2Q2020 earnings call July 29, it was considered a foregone conclusion that Charleston would be selected for the site.
LNA provided extensive coverage in 2009 about the decision. We’re publishing several articles in a Retrospective look about the decision then to locate Line 2 in Charleston.

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Boeing techs ratify contract extension

By Bryan Corliss

April 29, 2020 © Leeham News — Unionized technical workers who initially rejected a proposed contract extension with Boeing have changed their minds.

Their union – the Society of Professional Engineering Employees in Aerospace (SPEEA) – on Tuesday announced that the techs had approved a proposed contract extension with a 74% yes vote.

The deal extends the techs’ contract with Boeing until October 2026, putting them in sync with unionized engineers at the company, who had approved a companion contract offer in March.

SPEEA represents some 4,700 techs at Boeing – mostly in Puget Sound, but also in California, Oregon and Utah – along with nearly 13,000 engineers.

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Boeing announces voluntary layoffs in Puget Sound

By Bryan Corliss

April 28, 2020, © Leeham News: Boeing on Monday formally announced it would offer voluntary layoffs – essentially contract buyouts – to members of its Puget Sound workforce.

For most workers, the offer would give them one week’s pay for each year of service, up to a maximum of 26 weeks. Boeing would also continue paying health insurance benefits for most of the laid-off workers for three months. (The exception to this: Machinists Union members will get six months of extended health benefits under the terms of an agreement negotiated in 2016.)

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Engineers OK Boeing contract extension; techs say no

By Bryan Corliss

March 11, 2020 © Leeham News – New Boeing CEO Dave Calhoun earned a split decision in his first major labor relations test Monday, as unionized engineers with the company’s Commercial Airplanes division narrowly approved a contract extension. A second unit, for technical workers, rejected a similar proposal.

The news came as Boeing announced the first case of COVID-19 among its 70,000-member Puget Sound workforce: an unidentified employee at the company’s Everett plant.

The proposal for engineers belonging to SPEEA (the Society of Professional Engineering Employees in Aerospace) was approved with a 51.2% yes vote, the union reported shortly before midnight (Pacific Time). Technical workers, however, rejected a similar deal with 56.7% “no” vote.

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