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Boeing cutting workforce in Puget Sound as production stabilizes

Post by John Gillie / The News Tribune on March 22, 2013 at 3:09 pm |
March 22, 2013 3:55 pm

Boeing will lay off some 800 machinists and cut another 1,200 to 1,500 jobs by attrition in the Puget Sound area by the year’s end as production on its two newest jets stabilizes, the company said Friday.

Boeing said the cutbacks aren’t connected with the recent battery problems Boeing has encountered with its 787 Dreamliners.  Those problems have kept the 50 787s already delivered grounded and has kept dozens of others already produced from being delivered to Boeing customers.

Most of the layoffs and attrition reductions will come from Boeing’s Everett plant where it produces its 787s and 747-8s, the two newest members of the Boeing family of airliners.  Boeing has been raising production levels on both planes in recent years.  It is now approaching its target production of 10 Dreamliners a month and two 747s monthly.

Weak orders for the 747-8 have caused analysts to speculate Boeing may trim 747 production rates.

Boeing still has a huge backlog of orders both for the 787 and the 777.  Major components for both those planes are made at Boeing’s Frederickson plant in Pierce County, and production demands are not expected to drop there.

“Impacts to fabrication are expected to be minimal,” said Boeing spokesman Doug Alder.  Both Frederickson and Boeing’s parts plant in Auburn are fabrication facilities.

While the 2,000 to 2,500 drop in Boeing employment numbers is a large number,  for Boeing, whose local employment crested at 86,800 in November, its a small variation.  The company has hired nearly 4,000 workers since this time last year.

Since Boeing’s Western Washington employment bottomed out in June of 2004 at 52,763, employment in the Puget Sound area has grown by more than 33,000.  As of Feb. 28, Boeing’s Puget Sound payroll was 86,198.

Some of those being laid off have been engaged in modifying 787s to current standards after they emerged from the production line in Everett.  Boeing rented a huge hangar from Aviation Technical Services at Paine Field near its wide-body aircraft assembly plant to make those modifications.

Early versions of the 787 had to be modified to add features that Boeing incorporated after extensive testing.  That modification process is scheduled to continue through 2014.

The cutbacks are also being made in North Charleston, S.C. where Boeing also assembles 787s.

“It was always expected that employment requirements would come down on these programs as we transitioned into stable production,” Boeing spokesman Marc Birtel told the Chicago Tribune.

Boeing may soon be facing new demands on its cash as airlines whose Dreamliners were ordered out of service by aviation authorities while Boeing redesigns its battery and charging system.

Just how long Boeing can continue to keep its employment levels down may be determined by how it manages several developmental programs.

The company’s board is reportedly nearing a decision to offer customers an updated version of  its best-selling 777 twin jet called the 777X.  And the company is also working on designs for its newest 737, the 737 Max,  and on a stretched version of the 787, the 787-10.

Meanwhile Boeing is creating a modified version of its 767 passenger plane to be used as the Air Force’s new aerial tanker.  All of these programs could require new hirings for engineering, and eventually, production.

In recent years, Boeing has been careful not to overhire as had been its habit in the past when Boeing’s employement numbers periodically rose and fell as demand ramped up steeply and then fell just as sharply.

In the late 1990s, for instance, Boeing employment in Washington topped 104,000.  By 2004, it had dropped to about half that number.  The 9-11 terrorist attacks played a big role in that production decline as airlines deferred orders and   delayed ordering new planes.

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