IAM reaction prompts Boeing warning on 777X assembly

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Boeing now warns that sites outside the Puget Sound region of Washington will be considered for 777X assembly if union members reject the company’s proposed terms.

Anything less than “full acceptance” by the International Association of Machinists and Aerospace Workers (IAM) and state legislators for Boeing’s terms will re-open Boeing’s selection process, the company says.

“We chose to engage in Puget Sound first,” Boeing says in a statement issued on 8 November.

But “we will be left no choice but to open up the process competitively and pursue other options for locating 777X work”, the company says, if IAM members reject the proposal.

The warning was issued hours after reports that IAM District 751 leader Tom Wroblewski tore up the proposal Boeing submitted to the union on 5 November.

Three days ago, Wroblewski released a statement saying that Boeing’s proposal “merits consideration” given the size and strategic significance of the 777X programme.

Boeing has assembled the 777 and all other widebodies in Everett, Washington since the launch of the 747 programme in the late 1960s. But decades of labour strife with the IAM and the Society of Professional Engineering Employees in Aerospace (SPEEA) have taken their toll.

In 2012, Boeing opened a second assembly line for the 787 in North Charleston, South Carolina. More recently, the company has moved to acquire another 260 acres adjacent to the North Charleston production site, but has not explained how the property could be used.

IAM has scheduled a vote for 13 November, but news reports say Wroblewski may call off the balloting and reject Boeing’s proposal.

“If this is not ratified per the scheduled union vote on November 13th, we will begin taking the next steps,” Boeing says.

“All of our options are still on the table, including those within Boeing and other interest we have received from outside,” the company says.

At the same time, a key element of Boeing’s strategy in formulating the 777X design was to keep development costs down, partly by re-using the fuselage cross-section and overall design of the existing 777 family for the new models.

Boeing has proposed significant and controversial changes to the benefits package for IAM members, as a price for keeping the 777X assembly in Everett.

The proposal includes shifting union members from a pension scheme to a defined contribution plan for retirement savings.

If the union ratifies the deal, all members would receive a $10,000 signing bonus.