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Boeing solicits bids for 777X production site

Soumis
 
Boeing is soliciting bids from more than a dozen locations that want to build the new 777X airplane and secure thousands of jobs along with it, a company official said Saturday. Spokesman Doug Alder said requests for proposals began going out Friday. Boeing wants the proposals returned in a few weeks, and the company hopes to make a final decision early next year. (www.usatoday.com) Plus d'info...

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canuck44
canuck44 2
Boeing has lots of facilities in the St Louis area, but Missouri and California are not right to work states, a consideration for the long term. SC, AL, TX and Utah would have a leg up if that is important to management...the same management that picked Chicago over Dallas. Go figure.
PhotoFinish
PhotoFinish 1
Too bad. Since they have that huge facility already in Long Beach, that will be empty in the near future. So that's 3 areas that already have a Boeing presence (Seattle, SoCal, St Louis) that might not be strategic growth areas because of adverse labor law. These areas have trained aviation machinists available, that may find employment opportunities declining over time in those areas.

Chicago might've been about being at a hub city with more than one major hub carrier and lots of flight connections to all over the world.

Also maybe to not repeat the some circumstance where they concentrate their plane making and corporate offices in one area like they had at Seattle. The pain of moving important work/ facilities/ workers may discourage concentrating in ant one area.

By putting the corporate center in Chicago, the city gets the office gig. But all other potential fabrication sites get equal treatment, and there won't be special pressure to bring increasing amounts of plane making to the same area of the the corp offices. (Like might be the case if they were in Texas.)

But concentrating operations in another single location, leaves the company open to the possibility that the law would change over the coming decades and leave the company in much the same situation, from which they are finding a need to extricate themselves at the moment.
canuck44
canuck44 2
Those "trained aviation machinists" are likely to be very portable joining the exodus of taxpayers and jobs from California as they move to states where they can keep their earnings. The capital cost of a facility will most likely be offset by state and/or local government with tax forgiveness etc. Likewise if the State is likely to want a slice of Boeing's earnings down the road they will be off the list quickly...strike two for California just deemed the worst managed state in the Union by 24/7 Wall Street.
http://www.usatoday.com/story/money/business/2013/11/22/best-worst-run-states/3671359/?sf19828017=1
PhotoFinish
PhotoFinish 1
There was a study that showed higher unemployment among homeowners than non-homeowners. Some people get stuck in their ways, and can be reluctant to move, especially if there largest asset is a house stuck near a plant(s) that are closing, that has dropped in value as the jobs evaporate.

Boeing machinists who just rejected a new long term contract might not want to be buying houses now that can be an impediment. Also, they should know what their new source of income would be when their job ends. Renting would be a better fit for a temporary job situation. This is especially true for hard-working younger machinists with low seniority and a willingness to move somewhere else for a good job when the time comes.

That is, if the 777X is awarded out of state, as many expect. If Boeing keeps the 777X in Washington, then you can forget everything that John and I are saying.

preacher1
preacher1 1
I would be surprised if they don't take it away. They note in the article that they plan no meetings with the machinist's group. That is not to say that the machinist's could not reconsider and come up with a counter offer that might be attractive.
PhotoFinish
PhotoFinish 2
Would've made sense to accept a contract for the best plane making jobs in the country at high pay and with great benefits, that locks in the terns for a long time. A good job is a good job. Who needs the drama of contract negotiations every couple of years.

But they didn't accept it. 2 to 1
preacher1
preacher1 1
It will be interesting to see what happens. Machinist's could have a change of heart once they decide Boeing wasn't bluffing this time. Possibly Boeing could do something as simple as put an age limit on that pension thing, as far as starting it. It might just be that the older heads are scared of making such a change and being on their own after so long. idk
PhotoFinish
PhotoFinish 1
You brought up an interesting point. It would be interesting to know the demographic breakdown of the vote. Also, how do people make up their minds and what are the strongest factors - (eg. fear (of what), miscalculation, already comfortable, don't want change, want a steady job for decades, already near retirement, etc.)
preacher1
preacher1 1
My only reason for thinking about that is you or somebody, somewhere, in all the post and articles that ran about that vote, brought it up about the older heads might be feeling betrayed as they had worked all their lives based on certain things, and that pension being one of them. I liken that to the earlier debate Congress was having about Social Security. The were going to leave the older folks alone that were at or near retirement age and start the private plan with younger folks. Just a thought
PhotoFinish
PhotoFinish 1
I see. It's certainly a consideration.

In the proposal all pensions that were earned would continue to be paid. After the cutover, contributions would apply toward the new pensions (instead of adding to the older pension.

Nothing would be taken away. Folks who are retiring would have the same as they always had forever. Folks who continue to work would have two pensions. The first would be payment for pension earned in the old system. The second would be an individual retirement fund that would accrue contributions and value through retirement and disbursements.

Each of these workers would get 2 disbursals, one from each of the 2 pension systems.

New employees would only have the new individual fund pension system funded by the company, with additional employee contributions also possible for all employees.

Every employee would have a pension funded by each year of work at the company. Earlier years would pay into one pension system. Later years into the other.

The health and continued profitable operation of the company will allow it toncontinue to make any pension and healthcare obligations made to older employees. If the company goes under or experiences andecades long slow death under the wright of these obligations, the likelihood that earlier fixes benefit pensions will be paid in full will drop.

Worst case scenario, if the government has to take over a failed pension system, the guaranteed goverent payments are only a very small fraction of what Boeing would've paid. It's in no one's interest not too find a sustainable solution that both provides all employees a good retirement and also relieves the company of long term obligations that could bring and end to the company and future fixed pension payments.
PhotoFinish
PhotoFinish 1
But there may be a difference in how the pension accrue. Younger workers have decades to accrue interest and grow their nest egg. Older workers contributions will have a shorter time to grow their retirement account, so may not like the new system. Some younger workers may even vote against their own interest in solidarity with this closer to retirement, but not quite there yet.
preacher1
preacher1 1
Just my 2cts worth; other existing Boeing facilities have basically the same problem that Seattle does, a contrary work force, or at least one not really controlled. Facing a layoff & shutdown, Long Beach might not be contrary on the front end but who knows the future. Because of already having a governmental relationship and existing infrastructure, my money is on South Carolina. I think that some of the other locations will get lip service and that Boeing will do their best to make it look competitive, but I got a feeling their mind is already made up.

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