Bloomberg News

Boeing Assigns Much of 777X Design Work Away From Seattle (2)

October 30, 2013

Boeing Co. (BA:US) assigned much of the design work for its upgraded 777X wide-body jet away from the Seattle area, where the planemaker historically has done most of its engineering and production.

Design tasks on Boeing’s biggest twin-engine jet will be split among five engineering centers in South Carolina, Alabama, California, Pennsylvania and Missouri, supported by a facility in Moscow, the company said in a memo to employees. No decision has been made on Seattle-area design or production, Boeing said.

“Our goal is to leverage skills from across the Boeing enterprise,” according to the memo today from Mike Delaney, commercial airplanes vice president of engineering, and Scott Fancher, vice president of airplane development. “We are leveraging lessons learned on 787 and 747-8 to ensure continuity across the 777X program to accomplish the key design work.”

Boeing is trying to avoid the delays that plagued the 787 Dreamliner and the latest version of the 747 jumbo jet as it modifies the 777, the company’s top seller among its current twin-aisle models. Chicago-based Boeing is targeting the 777X for a commercial debut near decade’s end.

Dubai Airshow

“The announced structure will allow for an efficient use of resources and enable Boeing to resolve design issues effectively the first time,” the memo said.

The 777X may garner as many as 255 orders worth $87 billion during an expected introduction at the Dubai Airshow next month, according to people familiar with the matter.

Boeing closed little changed at $129.68 in New York. The stock has gained 72 percent this year, three times the increase of 24 percent for the Standard & Poor’s 500 Index.

A 787 assembly plant that opened in North Charleston, South Carolina, in 2011 was Boeing’s first new commercial airplane production site outside of Washington state’s Puget Sound region, where the company was founded in 1916.

Boeing, one of the principal employers in the Seattle area, met resistance from its machinist union over the factory’s location in South Carolina and the National Labor Relations Board filed a complaint against the company in April 2011. Boeing and the NLRB reached an agreement in December 2011 that included assurances a new version of its 737 single-aisle jet would be built in Puget Sound.

Experience Center

Engineers in Seattle should maintain their pivotal role in airplane design for the 777X, said Ray Goforth, executive director of the Society of Professional Engineering Employees in Aerospace, the company’s engineering union.

“Puget Sound is Boeing’s center of experience in commercial aircraft design,” Goforth said in an e-mailed statement. “As engineering tasks are shared with other talented engineering groups, we fully expect Puget Sound to play the key integrating role needed to avoid a replication of the problems experienced by the 787 program.”

To contact the reporter on this story: Thomas Black in Dallas at tblack@bloomberg.net

To contact the editor responsible for this story: Ed Dufner at edufner@bloomberg.net


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