Overall, things are going pretty well for Boeing. The Renton factory is pumping out 737s, the 787 growing pains appear to be over, and 777 production, save for challenges with one particular robot, is progressing nicely.
That Washington production lines are humming is important as Boeing prepares to build a new plane, which means it’ll soon decide where to build that new plane. As The Seattle Times reports, Boeing will likely announce a new midsize plane at the upcoming Farnborough International Airshow in England. And because of the aforementioned successes at the company’s various Washington facilities, the Puget Sound region could be dealt a significant chunk of the manufacturing business associated with the new model.
Once a given that Boeing production would take place in Washington, the state now competes with facilities abroad and in the U.S., particularly South Carolina. Boeing’s relationship with the local engineering and Machinists unions has soured, and jobs have been relocated to South Carolina and California in recent years. But building an entirely new jet in the Puget Sound region would not only stem the outward flow of area jobs, but would likely result in new jobs created here.
The new jet, which the Times suggested could launch around 2020, will certainly receive significant attention from the company — a midsize model is a crucial component in Boeing’s ongoing battle with Airbus in the commercial flight realm.
If Only Boeing Customers Could Get Some Financing Help
One reason behind Boeing’s international success has been the Export-Import Bank, the U.S. institution that provides loans for foreign buyers of U.S.-made goods. For nearly six months last year, legislative gridlock led to the bank being shut down. It reopened in December, but thanks to Sen. Richard Shelby, an Alabama Republican, the bank remains unable to finance major Boeing transactions.
While the Ex-Im Bank may be up and running, any deal that tops $10 million — buying Boeing 737s in bulk typically costs at least $40 million per plane — must be approved by the Senate Banking Committee. Shelby heads that committee, and he sees Ex-Im as a giveaway to large companies like Boeing. Thus, he’s stalled President Barack Obama’s nomination of member for the five-person board. Three members must approve a deal; right now, that’s not happening.
As a result, large companies, particularly Boeing and General Electric, are working with international credit agencies. The United Kingdom is financing Boeing deals on the condition that Boeing buys Rolls-Royce engines, for example. G.E. for its part is expanding operations outside the U.S.
“Is it going to put G.E. out of business? Absolutely not,” G.E. vice chair John Rice told The New York Times. “We can go to a plant in France, or a plant in Switzerland and Germany.”
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