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Wed, Mar 03, 2010

Albaugh: Boeing Would Prefer To Build Airplanes In Washington State

But Labor Issues May Force The Company's Hand, CEO Says

Boeing Commercial Airline CEO Jim Albaugh says the company would prefer to build airplanes in the Puget Sound region, with the caveat that the preference holds only if the Machinists union moderates its future wage demands and avoid strikes.

"This is where our people want to live. This is where we want to be. We've had a great partnership with the people of Washington, and I hope it continues for a long, long time," Albaugh told the Seattle Times. However "(I)t's going to be a much more competitive environment out there in the future. And work anyplace is not an entitlement."

Albaugh told the paper that if Boeing wins the KC-X competition with the Air Force that Everett will see growth from the contract. He also said he thinks Boeing will again deliver more airplanes than arch-rival Airbus in about two years.

Albaugh said the overriding factor in picking South Carolina for the second Dreamliner line was the strike threat from the Machinists Union. "(W)e can't afford to have a work stoppage every three years. And we can't afford to continue the rate of escalation of wages," he said.  Building a new factory and hiring from an inexperienced labor pool is far less expensive than shutting down a production line, Albaugh added.

Boeing's James Albaugh

He also stressed that, if Boeing wins the tanker competition, many of the structural modifications on the 767 airframes will be done in Everett, though the specialized equipment making the airplane a tanker will be added in Wichita. 

As to Boeing's position relative to Airbus, Albaugh predicted that when the company starts to deliver Dreamliners in quantity, beginning in 2012, the company should regain its position as the worlds top plane maker.

FMI: www.boeing.com

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