Boeing to consolidate production of Dreamliner in South Carolina as demand drops

The Boeing Co. plant is located in North Charleston, South Carolina, USA, on Monday, May 4, 2020. Boeing is restarting its 787 operations at the plant for the first time since April 8, including all operations that were suspended because of the Covid-19 Pandemic, ABC News reported.

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Boeing said on Thursday that it plans to consolidate production of the 787 Dreamliner at its South Carolina plant next year, in an attempt to cut costs amid weak demand, marking a blow to the Seattle area’s production hub. .

In July, Boeing said it would evaluate the consolidation of production lines for the widebody jets, which it currently has in Everett, Washington, where it began producing the planes in 2007, and in North Charleston, South Carolina, a factory where the work is not unionized.

At the time, Boeing said it would further cut production plans already reduced from the 787, an aircraft used frequently on international routes, which were more affected than domestic aircraft during the coronavirus pandemic. It will make six 787 planes a month next year, up from 10.

“To ensure that we can be effective in a market that will be smaller in the short term and that will have different demands from our customers in the long run, we made the decision earlier this morning to consolidate production of 787 in South Carolina after months of study. detailed and complete, “wrote Stan Deal, CEO of Boeing’s commercial aircraft unit, in an employee memo.

Boeing said mid-2021 is its “best estimate” for beginning production consolidation in South Carolina. The company noted that only the North Charleston facility is ready to produce the 787-10, the largest model in the Dreamliner family. .

After the announcement, which was expected, Boeing shares fell since the day’s high and rose less than 1% in the afternoon trading session.

Boeing announced the second production line for the 787 almost 11 years ago, and consolidating production is the last pain for Boeing workers and the economy surrounding its production facilities in the Seattle area. Boeing employs about 7,000 people in South Carolina and about 70,000 in Washington state, according to its most recent counts.

“Boeing’s decision to withdraw its 787 production from Washington State is short-sighted and misguided,” said Representative Rick Larsen, D-Wash., Chairman of the Chamber’s aviation subcommittee and whose district includes the Boeing Everett plant, in a statement on Wednesday. “When the economy returns and air travel returns, I will struggle to bring 787 production back to Everett.”

The bleak aircraft market, after two fatal drops from its bestseller 737 Max, sparked a wave of cost cuts. Boeing earlier this year said it planned to reduce its workforce by 160,000 by 10%, warning this summer that more cuts are possible.

The Max, Boeing 767, 777 and 747 jets are manufactured in the Puget Sound area of ​​Washington state.

Boeing also plans to stop making the iconic 747 jet, which is also produced in Everett in 2022.