Boeing’s decision to consolidate 787 Dreamliner production in South Carolina cements the standing of Boeing’s East Coast manufacturing complex, which was born out of the 787’s troubled beginnings yet has since been steadily expanded and strengthened.

Correspondingly, the loss of 787 production inevitably again raises the question of Boeing’s future in Everett and the Puget Sound region.

Boeing on Thursday confirmed that 787 assembly will be done exclusively in North Charleston, S.C., by the middle of next year, abandoning the original final assembly line in Everett.

It cited the need to reduce costs as it faces the breathtaking damage to its airliner business from the COVID-19 pandemic.

In a message to employees, Seattle-based Commercial Airplanes CEO Stan Deal acknowledged that “the 787 is the tremendous success it is today thanks to our great teammates in Everett. They helped give birth to an airplane that changed how airlines and passengers want to fly.”

And Deal insisted that “today’s decision does not change our commitment to Washington state.”


Local reaction included both disappointment and anger, with a mix of views on how to respond.

Gov. Jay Inslee called the decision to pull Dreamliner production out of Everett “an insult” and hinted at a possible political backlash.

In a statement, he said the state needs to review its partnership with Boeing and its favorable tax treatment.

However, in a virtual news conference, Snohomish County Executive Dave Somers and Everett Mayor Cassie Franklin pushed back against a confrontational response.

“I don’t see this as a time for division,” Somers said. “It’s time to look at how we strengthen that partnership.”


Boeing’s two major unions — the International Association of Machinists (IAM) and the Society of Professional Engineering Employees in Aerospace (SPEEA) — expressed frustration.

Since Boeing announced in July that it was studying 787 consolidation, officials of both unions argued in regular meetings with management for keeping production here.

“We believe Boeing is making a mistake,” said SPEEA Executive Director Ray Goforth. He promised to work with local officials “to attract new aerospace jobs to the state by marketing the aerospace talent pool Boeing is walking away from.”

Jon Holden, IAM District 751 president, called the move of work away from Washington state “just another in a string of bad decisions Boeing has made that fails to capitalize on the strengths of our workforce.”

Desperate times at Boeing

The latest International Air Transport Association (IATA) data shows that by August, domestic air travel globally — though improved since the pandemic shut down travel in the spring — had recovered only to about half of normal demand levels, led by a recovery in China. International travel remained about 12% of normal.

There’s no expectation of a recovery to 2019 levels of air travel for several years, with demand for the long-haul jets made in Everett lagging that for smaller jets like the 737.


Already bleeding cash from the extended grounding of the 737 MAX, Boeing scrambled to respond. It reduced jet production drastically and announced substantial job cuts focused on its commercial jet unit to preserve cash.

Commercial Airplanes CEO Deal told employees 787 consolidation will help Boeing “weather these challenging times.”

In a news release, Boeing said that a detailed analysis completed in the past two months confirmed South Carolina as the better option to improve the efficiency of 787 production and maximize savings.

A big factor in that analysis was that the aft- and mid-fuselage sections of the Dreamliner are assembled in separate buildings in North Charleston and so can be rolled over on the ground to the final assembly line.

For production in Everett, those huge sections have to be airlifted across the continent on Boeing’s massive, custom-built Dreamlifter cargo planes. And the mid-fuselage of the largest Dreamliner model, the 787-10, is too long to fit inside the Dreamlifter, so that this model is built only in South Carolina.

Boeing said the decision is just part of its response to the staggering hit from the pandemic and that it intends “to reassess all aspects of Boeing’s facility footprint, organizational structure, portfolio and investment mix, and supply chain health and stability.”


The impact in Everett

Deal’s assurance that Boeing remains committed to this region cited the “many long-term investments” the company has made here since 2013, in particular spending more than $1 billion in Everett for production of the new 777X.

Yet the outlook for Washington’s aerospace has surely dimmed.

The 767 and 777X programs will be all that’s left in Everett once the 747 jumbo jet program ends in 2022, and both are likely to be at low-volume production for the foreseeable future.

And although Rep. Rick Larsen, D-Everett, said he would “fight to bring 787 production back to Everett” once the economy recovers from the pandemic-driven downturn, that effort is unlikely to bear fruit because Boeing makes decisions for the long term.

When Boeing CEO Dave Calhoun announced the 787 consolidation study in July, he explicitly said that Boeing would only make the move if the single location chosen could ramp up to handle the expected production levels needed after the economy recovers.

Even before the 787 news, Boeing had already announced that it will cut 12,600 jobs in Washington state this year through a combination of buyouts and layoffs because of the steep aviation downturn.

The immediate additional impact is estimated at about 1,000 direct 787 jobs lost, consisting of production work on the final assembly line and in fabrication and interior cabin shops, plus support employees.


That also includes small numbers of jobs lost at suppliers that keep teams in Everett to handle delivery and installation of systems such as landing gear and engines.

In addition, every Boeing job in Everett supports multiple service jobs in the city and surrounding region, from restaurants to barber shops.

Boeing pitted S.C. against Washington

The North Charleston manufacturing site was born out of the mess Boeing made of its global outsourcing plan for the 787 and grew bigger because of management’s antipathy to the strong unions in the Puget Sound region.

In the original 787 plan in 2003, Boeing signed up two outside partners — Alenia of Italy and Vought of Texas — to build the fuselage sections, and those partners chose to build plants in South Carolina, drawn by incentives from the state and its anti-union culture.

But Alenia and Vought proved incapable of producing the plane to the required quality, and in 2009 Boeing was forced to buy them out and take over the work. Unexpectedly, Boeing suddenly had an East Coast airplane manufacturing site.

That same year, Boeing decided to build a second 787 final assembly line. Then-CEO Jim McNerney, enraged by a damaging Machinists strike the previous year, ignored all pleas to put the second line in Everett and chose to locate it alongside the fuselage assembly plants in South Carolina.


From that point on, Boeing could use North Charleston as leverage against Everett, playing one state off against the other.

The future of Washington aerospace

When Boeing in 2003 chose Washington state over other contenders, including South Carolina, for the original 787 final assembly line, The Seattle Times obtained an internal company analysis of the options, which showed that one factor considered was the impact on the morale of its major workforce here and the potential for labor unrest if it chose somewhere else.

In the years since, Boeing overcame that worry and has pursued a deliberate strategy to decentralize its workforce.

In 2013 and 2014, Boeing sent thousands of jobs from the Puget Sound region to new engineering centers in California, Missouri and South Carolina. Many older engineers chose not to move and left the company, replaced by younger, less expensive engineers at the new sites.

The impact of the loss of the 787 goes beyond the immediate job losses. The hole it leaves looms deeper because it’s Boeing’s best-selling widebody jet, the one with a clear future.

In contrast, the 747 jumbo jet is already at a very low production rate of one jet every two months and set to terminate in 2022.


Boeing no longer produces the passenger version of the 767, only freighter jets and the airframe for the KC-46 Air Force air-to-air refueling tanker.

As for the 777X, the market has shifted decisively against larger planes in the pandemic and will take years to recover. Sales of the 777X have been badly hit, and launch customer Emirates switched part of its large order to 787s, a move other customers may follow.

The result is that combined demand for the 767 and 777X for the next few years is likely to support a rate of five airplanes a month, down from the 15 jets per month that Everett was pumping out last year.

Rumors among the workforce are rife that Boeing might shut down its 737 MAX plant in Renton and move production up to Everett. However, this would be very challenging logistically and would risk upsetting the planned recovery of the MAX once it is ungrounded.

Realistically, the long-term future for this state’s aerospace industry depends crucially on Boeing’s next new airplane. If it’s built here, the state’s historic legacy of plane making will continue.

If not, the industry will gradually dwindle and end when the 767, 777 and MAX wind down in the 2030s.


The reality is that as Boeing fights to survive this downturn, it is not considering putting any cash into a new airplane for several years.

It has shelved the previous proposal for a new midsized, midrange airplane that was much discussed for several years.

The aerospace industry in this state can flourish again only if there is an economic recovery and then Boeing chooses to build its next plane here. The jet maker will have plenty of room available in Everett.