St. Louis Newspaper Reveals Details of Beoing’s 777X RFP

By Steve Wilhelm, December 5, 2013, Puget Sound Business Journal

Details of what Boeing is seeking in a site for assembling the 777X jetliner have emerged in a story posted Thursday by theSt. Louis Post-Dispatch. St. Louis is among areas contending for the assembly of Boeing’s future 777X jetliner model.

The story said Boeing’s 11-page request for proposal indicates the company is looking for one 4.2 million-square foot facility, costing $7 billion to $10 billion, to be used for assembling the plane and wing.

Another option would be two plants, one 3.1 million-square-foot plant costing $4 billion to $6 billion for the fuselage and final assembly, and a second 1.1 million-square-foot plant costing $2 billion to $6 billion for the wing.

The company (NYSE: BA) wants to start building its factory in November 2014, and to start aircraft production in July of 2016.

Boeing indicates the new plant would employ 3,250 in 2018, and grow to 8,500 by 2024, the story said.

The proposal said that a “seaport” is desired, but that doesn’t seem to be a requirement. The story said a seaport would have to able to handle container ships and regular international carrier services.

This aspect has been of interest in the Puget Sound area, given the fact that 777 fuselage sections currently arrive in the port of Everett from Japan aboard ships, and then are moved by rail to the nearby Everett plant.

The site also needs to be near a “major international airport” with at least a 9,000-foot runway that is able to handle planes as large as 747-400 freighters, the story said, quoting the Boeing RFP.

The St. Louis story quoted Boeing as saying, “transportation is one of the most critical site selection determinants,” adding that this mean a dedicated rail spur, and “easy access to a major highway”

Boeing would like some help, too. The RFP adds that “company preference is toward a location that will share in the cost of capital expenditures.”

It lists several factors such as the cost of doing business, work force availability, quality and cost.

The RFP makes no mention of any preference for a right-to-work state over a union state, according to the St. Louis story.

This suggests that Boeing is trying not to step over a line that would indicate preference for a nonunion operation. Back in March of 2010, the Machinists filed a complaint against Boeing, claiming that it had violated federal labor law by opening the South Carolina plant in order to retaliate against union workers in Washington state.

This suit was never settled, but was dropped in December 2011 as part of the labor pact between the company and the Machinists union that kept the 737 Max jetliner production in Washington state.

Boeing already has extensive operations in St. Louis, which is the company’s center of jet fighter production.

Boeing did not contest the story.

“We aren’t commenting on the contents of the document or its authenticity,” said spokesmanDoug Alder, in an email.

Tip of the hat to analyst Scott Hamilton of Leeham LLC, for picking up on this.

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