Boeing's Union-Busting Move to SC Backfires; Can't Meet 787 Production Demand

[Divernan]

Boeing has learned there's a difference between RIGHT to work and ABILITY to work. When Boeing left Washington for South Carolina in order to suppress the wages of its workers, it also left behind the quality work that had been provided by a highly skilled, union workforce. Now, that union-busting is backfiring as productivity has dropped immensely and Boeing is unable to meet their 787 Dreamliner production goals.

Via to the Puget Sound Business Journal:

Boeing’s South Carolina facility is running behind projections and won’t make its goal of producing three 787 Dreamliners a month by the end of 2013. In fact, the Everett plant will have to make up the difference in order for the company to reach its overall goal of 10 jetliners a month by year’s end.

As recently as July 24, when Boeing announced second-quarter earnings, Boeing CEO Jim McNerney insisted the company is on track to hit 10 Dreamliners monthly by the end of this year. But how Boeing accomplishes that has become more problematic. Company executives have started saying that Boeing’s North Charleston, S.C., plant is somewhat behind its goal of contributing three 787s monthly by the end of 2013.

The cost savings associated with moving to South Carolina, where workers are paid nearly half of what workers in the Everett, WA plant make, are now for naught. The Everett plant will be counted on to make up the difference.

For Boeing, the news is only getting worse as one of their largest global competitors, Airbus, is looking to move to Washington state to build their new engineering center. Airbus Americas Chairman Allan McArtor explained the move:

We are attracted to Washington state for the same reason we were attracted to Wichita. That’s where the talent is,” he said. “If you want to have access to the talent that developed over the last 100 years of aviation, Washington is very fertile ground.”

http://www.bizjournals.com/seattle/news/2013/08/02/everett-will-have-to-make-of.html?page=all

Boeing moved to South Carolina to take advantage of “Right-to-Work” laws. In an internal memo that leaked they said, “the only consistent advantage attributed to Charleston was the ability to ‘leverage’ the site placement decision toward ‘rebalancing an unbalanced and uncompetitive labor relationship.’” Their new workforce is woefully inexperienced and cannot meet demand so they have to go back to Washington to get back on track. Meanwhile, their competitor is swooping in and taking advantage of the incredible wealth of skills in Washington. If karma has its way, the worker well will be dry before Boeing has a chance to return.

http://wepartypatriots.com/wp/2013/08/23/boeings-wage-slashing-move-to-sc-backfires-as-company-cant-meet-787-production-demand/

[Divernan]

1. Warning: Don't put your family on a 787 built in Charleston - "just shy of JUNK"

Here are two readers' comments from the Puget Sound Business Journal
Mark Costas · Kansas City, Missouri
Boeing decision makers continue to lie about the true speed and quality of work in Charleston. They continue to attempt to convince the public it was a wise decision to build that plant. Every single section of airplane that arrives in Everett from Charleston needs rework. Everett employees have to redo the work that Charleston botches and then still build the planes to meet the rate increases. You NEVER here the media fawn over Everett because Boeing and Nikki Haley doesn't want the truth to get out. Trust me, you do NOT want to put your family on a 787 that is built entirely in Charleston.
Reply · 2 · Like · Follow Post · August 4 at 12:11pm

John A. Totten · Top Commenter · Miami University
IIRC the 1st 3 fuselage sections sent from Charlotte to Everett were just shy of JUNK. All required MAJOR reworks before they could go on the assembly line. I shudder to think what an entire aircraft would contain.

[busterbrown]

9. How the heck do you know if your plane was made in Charleston?

[Divernan]

10. Excellent question. I have no idea.

Therefore, I will avoid 787s

[adieu]

15. You won't know until after the accident.

The FAA and the NTSB are not going to kowtow to large vehicle manufacturers and will investigate the accident to its origins. They will know where every bolt, every nut, every rivet was made and who tightened that bolt and who weld that line. Every manager, every supervisor, every recruitment officer will be accounted for.

Unfortunately for those who died in such an accident, that's information that came too late.

[Benton D Struckcheon]

2. You can't just transfer a plant like that and expect it will be the same

South Carolina simply doesn't have the industrial skills for this kind of thing (although I've been told the golf courses are outstanding. No doubt). The illusion that all of the US is the same is just an illusion. It depends on massive transfer payments from the developed parts of the US to the underdeveloped parts. But those transfer payments produce only a surface patina of similarity, not a real industrial economy that can produce stuff like jetliners.
It'll be hilarious to see the Europeans, who apparently realize the gift Boeing gave them, come in and prove the point for good.

[elehhhhna]

29. Theyalso got tax incentives and givebacks out the booty

from state and local taxpayers and the fed as well

awwww. all for some low(er than appropriate) paying jobs.

[madrchsod]

3. oh well they lived and learned but...

the stockholders are not going to be pleased.

skilled labor is very much in demand across america but without union trade apprenticeships
the well won`t be filled soon enough. trade schools are a good start but it`s not the same
as peer reviewed job training.

[hatrack]

26. And there's no limit to how skilled the work force gets when wages are shit . . .

God knows, I'd spend whatever time and money it took to build my skills to move from $10.50 per hour to $11.00!!!



Hmm, it's almost like there's a disincentive built into the idea of moving high-tech manufacturing jobs to low-wage, anti-union states . . .

[uponit7771]

4. I've not seen too many union busting moves that end up shooting the leadership in the foot...

...and making things worse.

I can see a middle ground of working together but a lot of Americans have been taught to dislike the working person

[uponit7771]

5. Also, this is dangerous..."inexperienced" is not something I would want to be associated with any...

...part of airflight

[Starry Messenger]

6. k&r

[meow2u3]

7. If top management doesn't learn now that you get what you pay for..

when will they?

[senseandsensibility]

8. Love this story for the way it put the management in its place

but workers still lost wages and jobs. Still, I'm glad their union busting was exposed as the idiocy it is.

[malaise]

11. Good

Fugg 'em! Reap what you sow!

[Unrepentant Fenian]

12. Boeing has, once again shot itself in the foot...

The average CPJ (Cost Per Job), is three times higher in South Carolina than it is in Everett, not only that but the poor production rate in Charleston is doing nothing to lessen the impact of the backlog on Boeing's bottom line. Safety for air travelers also has to be taken into account. The inexperienced workforce in Charleston will be forced to "cut corners" in order to try to inflate their production metrics.

While spending hundreds of millions of dollars to expand and upgrade the Everett plant, Boeing loves to make threats about closing the Union shop every time their labor contract comes up. This is obviously nothing but hot air, but I like to think that if Boeing were to shutter the Everett plant, Air Bus would be first in line to buy the building and set up shop in Everett. That alone would have to send Boeing into a tail spin.

[Divernan]

20. Speaking of Boeing's work force cutting corners, here's an alarming example

Airbus anticipates getting another shot at a contract for the aerial refueling tankers, "if Boeing stumbles" and can't "perform the mission or solve the weight problem."

Asked what “weight problem” he meant, McArtor scoffed at the fact that Boeing is not putting thrust reversers on its KC-46A tanker. “That’s one indication” of a drive to save weight, he said.

Thrust reversers are part of the engine system that the pilot activates on landing to help brake the plane so it can land in a shorter distance.

A source familiar with the tanker proposal who asked not to be named confirmed that the Boeing KC-46A tanker has no thrust reversers but added that they were not part of the Air Force requirement.

McArtor laughed at the notion of leaving out thrust reversers because it would mean the tanker needs a longer landing strip. He compared it to a car without brakes.

http://seattletimes.com/html/businesstechnology/2021226174_airshowmcartorxml.html

Although the work force cutting this corner is pretty high up the food chain, i.e., the designer, not an assembly line worker.

[adieu]

13. There's an Aesop's fable story here

The one about a dog with a piece of meat in his mouth cross a river over some rocks. He looks at his image in the river and sees a big piece of meat there. He drops his own to try to grab the image of the meat and voila, his meat falls into the river and he walks away with nothing.

You get nothing. NOTHING!

[Rebellious Republican]

16. I like that story, thanks.

[mick063]

14. Washington State welcomes Airbus with open arms

Washington State will continue to build the best airliners in the world.......for Europe.

[pnwmom]

18. This appears to be great news for Seattle.

Not so great for Boeing.

[Generic Other]

17. Seattle unions says "FUCK YOU" Boeing

Pay your union workers for the high skilled jobs they do, and quit trying to cut corners to save a buck. I would rather pay more and fly safe.

And to corporate that moved their headquarters to Chicago to destroy the machinists and engineers' unions, enjoy the blowback. Maybe you should start moving the offices back to Washington too.

[Divernan]

19. "Airbus' top man in US has most exceptional aviation resume of any aerospace exec in US."

The comments on this story in the Seattle times make a lot of disparaging comparisons of the "21st century MBAs leading Boeing" versus the industry-savy, aerospace-experienced engineer/fighter pilot American heading up Airbus' US efforts. I don't fly as much as I used to, but in the future, given a choice, I'll fly on an Airbus plane, not Boeing.

http://seattletimes.com/html/businesstechnology/2021226174_airshowmcartorxml.html

LE BOURGET, France — Airbus lost the long and contentious bidding to build an aerial-refueling tanker for the U.S. Air Force, but Airbus Americas chairman Allan McArtor asserts there are signs that Boeing will stumble and give its rival a renewed opportunity. “I think we’ll get another shot at it,” said McArtor in an interview at the Paris Air Show Wednesday.

He also said that Airbus, which has U.S. engineering centers in Wichita, Kan., and Mobile, Ala., is likely to add two more in the next decade and will seriously consider locating one in Washington state. “We are attracted to Washington state for the same reason we were attracted to Wichita. That’s where the talent is,” he said. “If you want to have access to the talent that developed over the last 100 years of aviation, Washington is very fertile ground.”

Those startling ideas came from Airbus’ top man in America, who has probably the most exceptional aviation résumé of any aerospace executive in the U.S. A highly decorated combat-fighter pilot in Vietnam, he was an associate professor of engineering at the Air Force Academy, then flew as a pilot in the Air Force Thunderbirds flying-display team.

Afterward, he headed air operations at FedEx, and under President Reagan he was head of the Federal Aviation Administration (FAA) for two years. Immediately before joining Airbus, he was chief executive of Legend Airlines, a regional carrier out of Dallas.

[hatrack]

21. Cue the Car Talk "Wah-wah" horn noise . . .

Dumbasses.

[Populist_Prole]

22. This is all about power & control

This is the logical extrapolation of what you get when class politics dominates and causes management to make irrational decisions. Oh, it's about money too, to be sure, that's an eventual goal, but this is a major trial balloon of the ultimate MBA "by the numbers" way of having Boeing become ( eventually ) a "virtual" airplane company. If they pulled this off successfully, there's nothing further they can't do. for years, decades really, globalist/free-trade shills have always sought to assuage concerns of US de-industrialization by always touting US leadership in aircraft manufacturing and it's resultant exports. It was the only bright spot.

Where am I going with this? Let's not be fooled: The SC plant was never meant to just assist in 787 production but to eventually replace the Everett one. Of course their move backfired since they were blinded by their own class conscious corporate hubris. If this DID sauced: How long do you think it would be before they offshore to the 3rd world even the scab Charleston plant?

I wouldn't be surprisd if Airbus has more US built content than a Boeing plane. ( Boeing has been subbing out A LOT of subassembly overseas for years and years )

[Helen Borg]

23. Holy smokes

Now, that's karma!

[Rex]

24. Fuck Boeing. Sadly they will punish the workers

more for upper managements mistake. Like a monarchy, the Haves will be taken care of. This horrible lust for greed will cause another TARP like crisis now that the Big Boys know they are on the federal payroll. Well they've always been there, but now they got a golden ticket for any maleficence they want to get away with.

[dballance]

25. Talk about THE Case Study in how not to try to break away from Unions

Some how I doubt many, if any, executives and bean counters will learn the lesson of the 787. Not just this last chapter with SC vs. WA labor. The whole project is a textbook case study in how trying to break free of the traditional supply-chain and labor relationships can be totally mis-managed. I wonder what would have happened if, instead, they'd made honest efforts to improve and strengthen those relationships. I bet they'd have had a plane sooner and of better, consistent quality.

But no. As another poster said. This is all about power and control. The execs and the bean counters decided to make sure everyone understood they waved the largest penis at the cost of quality, production promises, labor relations, and their customers. Both sets of customers - the airlines and the flying public. Sadly, the corporate compensation system of those people rarely penalizes them for their poor judgement and management any more. Corporate boards seem to be mere rubber-stamps anymore.

[riqster]

27. These people should have to return their MBA degrees.

Corporations are supposed to return maximum value to their shareholders, yes?

And Boeing is failing to do so, and that miserably. As noted elsewhere, they pursued a political agenda: but in addition, that agenda was to a large extent based on theoretical notions and was accompanied by short-term thinking.

When your planning horizon is "what time is it?", you will fail. When you rely on unquantified assumptions and do not adapt when the data proves them false, you will fail spectacularly.

MBAs are taught not to do these things. Anyone who does them is not worthy to hold the title.

This will, in a future business school be a case study of everything NOT to do in a business situation. I hope the workers get the jobs they deserve from Boeing's competitor.

[loudsue]

28. This needs to get a lot more visibility than DU.

It's time right leaning Americans understood that corporate management tends to be really really stupid, and they need to quit putting highly paid executives on a pedestal.

[Unrepentant Fenian]

31. You're 100% right!

[Scuba]

30. Kick

[City Lights]

32. Karma's a bitch, eh Boeing? nt

[Brigid]

33. One of these days . . .

I have got to buttonhole some MBA and ask him/her just what the hell they learn in business school.