Evergreen prestige in Lew of pay!

 

There is an existing Boeing operation in Charleston, they will just be expanding the operation by building a new facility. The Union there (IAM?) was just decertified in Charleston. The announcement to move the second line to SC followed shortly.

 

You also forget that that many aircraft sales are based on the manufactor using the local industry.

 

That's true. There are tools in place in many industries to protect domestic business. One of which is Local Content Requirement (LCR). A certain percentage is stipulated and is often exceeded.

In the case of the US aviation industry, foreign markets account for the vast majority of aircraft sales and the B787 is no exception.

Few complain when foreign firms build factories in the US and there's no shortage of FDI inlows into the US!

Al

 

In the interest of disclosure I'm a Boeing stockholder, however I think they screwed the pooch with their outsourcing on the 787.

Their plan to outsource a fairly large percentage of the aircraft was not based solely on being able to purchase parts cheaper. A major reason was "risk-sharing" whereby the companies who would be supplying parts for the 787 shared some of the risk involved.

But having said all that, while this sounds great on paper it has been a disaster for Boeing. After the A-380 fiasco, the 787 introduction was an opportunity for Boeing to show the world "how to do it right". Instead they screwed up royally. Any financial savings from outsourcing have been exceeded many time over by the delays and damage to the company's [former] stellar reputation.

Furthermore as we are discussing this, Boeing has more or less ceded the 100 seat aircraft market to Bombardier and the 737 NG series is a mediocre airplane. I believe they should be aggressively pursuing both of those market segments.

 

The argument sounds like the ones from the southern lawmakers who wanted to kill the auto industry because of "expensive labor agreements." They conveniently forgot to tell everyone that their pockets were lined with automaker dollars for the tax writeoff's to set up shop in Southern, traditionally non union states. So those plants have no "legacy costs," because they are fairly new, with workforces that get rotated out the back door when they have been there too long and their pay has gone up, or have work related injuries that cost them in terms of disability. In 20 years or less their costs will be as high as the northern, union plants. And they'll look to move somewhere else, greasing more lawmakers palms.

What we're seeing here is what the Japanese electronics industry figured out years ago. When it got too expensive to pay their workers, they set up plants in Malaysia, the Phillipines, and elsewhere. They now rotate the production on an as needed basis, to the plant with the cheapest labor cost.

Your argument is the classic, "I got mine, pull up the ladder." As long as everyone else takes it in the shorts so you can get it cheap, what do you care? Like shopping at WalMart...they buy at discounted rates, requiring producers to cut wages, sell cheap with employees that don't get any benefits and are told to go onto government run, taxpayer funded health care, and they rake in the dough.

Sound familiar? Try this. $99 dollar seats coast to coast for Ma and Pa Kettle to take the whole gang to Disney twice a year. The airline fills seats, but can't make a profit.

So who gives up concessions to keep their jobs?

Boeing is trying to do the same thing.

I wonder if they got offered a chance to hike the Appalachian Trail with the guv' as part of the deal???

 

So, you oppose Foreign Direct Investment outflows. Do you also oppose FDI inflows like the new Rolls Royce PLC factory currently under construction in Virginia? Or, is that kind of outsourcing ok with you?

And, BTW, Virginia wasn't selected by RR because of cheap labor supply!

Also, the most efficient plants in the world are Japanese and are IN Japan!


Al

 

I am a little late for this discussion but I currently fly the Dreamlifter for Evergreen. Oregon based company with American pilots flying them. Some info on the company in the cargo forum.

EVA or "The Evergreen group" in Taiwan is a totally seperate company.

 

There's still a little bit of room in the southeastern corner of the airfield where Boeing has its current facility to build an assembly building or two. Dreamlifters use this area to do their onloads now as it is.

Also, the Japanese may have extremely efficient plants, but their labor unions are extremely powerful and influential, even more so than their counterparts in the US. I used to oversee an aircraft plant near Tokyo that did work on US military aircraft. If we wanted to accelerate schedules or have the company support flight ops on the weekends, they had to clear it through the union first.

 

When will the British learn not to set up shop in Virginia?


I know of one rather large U.S. airline that sends its 767s over to Hong Kong for maintenance. On the flip side, same airline likes to use its maintenance department to perform outsourced work on other airlines.