Posted on 10/16/2003 6:27:40 PM PDT by BurbankKarl
Boeing to shut down 757 jetliner production in late 2004
By Elizabeth M. Gillespie The Associated Press
SEATTLE — Gov. Gary Locke and two of the state's leading economists predict that Boeing's decision to quit making its 757 jet will not deal much of a blow to Washington's economy.
Speaking from China, where he was on a weeklong trade mission, Locke said many workers are expected to find jobs elsewhere in the company or will leave through natural attrition.
"This is part of the natural evolution of the Boeing models," Locke said today, noting that the aerospace giant stopped building the 727 several years ago and moved to other models.
Roberta Pauer, an economist for the Washington state Employment Security Department, said the announcement came as no surprise, since "the 757 production rate had been pretty low for some time."
"I think it's just that this is an old plane, and its usefulness to customers has run its course," Pauer said. "That's what happens with planes. The design gets old, and new technology comes into being."
The single-aisle, twin-engine 757 is built in the south Seattle suburb of Renton. It's been popular for its fuel-efficiency and versatility in handling everything from short runways to high-altitude airports. But in recent years, more airlines have been buying 737s, which have grown in size to handle more passengers and cost about $20 million less per plane.
Alan Mulally, chief executive of Boeing Commercial Airplanes, did not immediately say at Thursday's announcement whether the production halt would lead to any job losses.
Since the terrorist attacks of September 2001, which crippled the airline industry, Boeing has eliminated 35,560 jobs, mostly through layoffs, and expects that total to reach 40,000 by the end of this year.
Bill Dugovich, spokesman for the Society of Professional Engineering Employees in Aerospace, the union for Boeing's engineers and technical workers, said any more job losses would hurt the company and the economy.
"There have already been enough people let go from the Boeing Co.," said. "Additional layoffs at this time will continue to erode the technological knowledge base of Boeing."
Connie Kelliher, spokeswoman for the Machinists Union District 751, representing production workers, called the news "disappointing," but said the union hopes Boeing will reassign 757 workers to other production lines.
About 225 machinists in the Puget Sound region currently work on the 757 line, and hundreds more handle fleet support, engineering, sales and marketing.
Chang Mook Sohn, the state's chief economist, said Boeing and the aerospace sector are expected to continue "much milder" layoffs during 2004, but the net effect won't rock the state economy.
"We expect to see improvements, new hires, sometime in '05. As the domestic economy and world economy improve, eventually the demand for commercial airlines will pick up," said Sohn, executive director of the state Revenue Forecast Council.
Pauer theorized the scrapping of the 757 might not lead to any layoffs, but said the move "does make more likely the ultimate shift by Boeing of all assembly north to the Everett site.
"They don't anticipate it in the near future, but it is a reasonable possibility at some point in this decade," Pauer said. "I do think a shift to consolidate their operations in Everett is now likely to come sooner."
Mulally said the company has no plans to shutter the Renton plant.
The phase-out of older lines is part of the company's evolution, and underscores why the state is trying so hard to land the proposed 7E7 Dreamliner assembly plant — seen as a way to nail down other next-generation planes as they come on line, Sohn said.
Dugovich, SPEEA's spokesman, said: "The ending of the 757 line makes a commitment to the 7E7 even more critical."
"There is some logic to it," Dugovich said. "The 7E7 program will fill that gap left by the 757, but it will only fill that gap if Boeing makes a commitment to the program and uses the expertise it has right now to turn the 7E7 into the next generation of Boeing aircraft."
A final decision on whether to launch the 7E7 is expected next year.
LOL!
Speaking from China, where he was on a weeklong trade mission, Locke said many workers are expected to find jobs elsewhere...
It could be. Another possibility is that it's the truth, which you, of course, cannot possibly consider.
Have you just recently got down from the tree?
Don't write to me again until you evolve into a human.
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