Even before Boeing announced drastic new layoffs that will hit Puget Sound hard, the need for a mutual reassessment was evident. Boeing’s ongoing business retrenchment will hurt in the near term. Washington state should focus on how to shape and aid Boeing’s long-range quest for renewal.
The direness of the company’s condition is clear. An ongoing 19% companywide workforce reduction will cut Boeing by more than 30,000 jobs from its 2019 levels. The company is expected to sit on immense empty space in its Everett plant and may sell its huge Commercial Airplanes headquarters office in Renton. There are operating losses, hundreds of undelivered 737s and 787s, and a pandemic eviscerating potential demand for years to come. Rival Airbus will deliver about 500 jets this year; Boeing, about 170.
Boeing’s standing, both in its industry and as one of Washington’s flagship businesses, has not been so precarious in decades. And while Boeing’s long-term decisions have moved its executives to Chicago and 787 production to South Carolina, the company remains immensely vital as a Puget Sound economic engine. The converse is also true. Because so much of Boeing is still Washington-centric, state policies about taxation, education, workforce and livability will affect the company’s ability to rebound.
That’s what needs to be the focus now — the factors that build long-term mutual resiliency. The “hard look” at tax breaks Gov. Jay Inslee spoke of in early October after Boeing announced its 787 production move sounded like the rhetoric of years earlier, after the company’s other shifts out of state. That’s the tone of a scorned partner, not a pragmatic realist. And the facts are that Boeing is making cold, and difficult, business decisions with its long-term viability an open question.
Boeing bears responsibility for many of its challenges and must reform. The appalling safety and oversight failures federal investigators found in the 737 MAX project ought to prompt a thorough overhaul of Boeing’s culture. External moves should focus on how to encourage this transformation and revive the ethos of excellence that once defined Boeing. Regulatory changes are in order, notably, a much-needed federal overhaul of safety certification crafted through bipartisan work from U.S. Sens. Maria Cantwell, D-Wash., and Roger Wicker, R-Miss.
The disaster of the 737 MAX, including the two crashes that killed 346 people, initiated Boeing’s difficulties. A Congressional report in September showed top 737 MAX program executives professed ignorance to federal investigators about the plane’s complexities and flaws. Boeing’s Keith Leverkuhn told U.S. House Transportation Committee investigators that he considered development of the MAX a success. Now the company is even trying to distance itself from the MAX brand name.
Boeing has a lot to rebuild. Churlish haggling over tax breaks is not the best way Washington can play a productive role. If ever Boeing needed Washington to be the world’s best place to build airplanes, that time has come.