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Boeing’s Production Problems Hurting Bottom Line




By FITSNEWS ||  We’ve said it before and we’ll say it again, when Boeing says “jump,” South Carolina’s mainstream media asks “how high?”  And its elected officials ask “how much?”  And then make you pay the bill …

While the Palmetto State’s politicians and press corps continue to slavishly serve the aircraft manufacturer’s interests, this website has had the audacity to report on what’s actually going on inside the company’s North Charleston, S.C. facility.

FITS was the first news outlet in the country to report on production issues at Boeing’s North Charleston facility – which was built thanks to $1 billion in taxpayer-funded incentives doled out by Gov. Nikki Haley and state lawmakers.  Two months later, reporter Phil LeBeau – who covers automotive and aerospace issues for CNBC – confirmed much of our reporting.  More recently, The Seattle Times  and The Wall Street Journal  have referenced South Carolina’s production problems – while Reuters has exclusively reported on how those issues are affecting the company’s global supply chain.

And of course there was last month’s shocking Al Jazeera exclusive – which uncovered evidence of rampant drug use among employees at Boeing’s North Charleston plant.

Anyway … all of these production issues have had an impact on Boeing’s bottom line.

The Dreamliner has been a nightmare for Boeing from the start.  Originally scheduled for delivery in May of 2008, numerous design, supply and delivery problems pushed that deadline back more than three years – causing numerous cancellations and ramping up pressure on the company to make the plane profitable.

In January 2013, the Federal Aviation Association (FAA) grounded the 787 due to conflagration issues associated with its lithium ion batteries.  Problems with the plane have continued since it was cleared for flight – including an incident in August in which a Dreamliner belonging to British-based Thomson Airlines began losing altitude and was forced to make an emergency landing during a transoceanic flight.

According to a new Bloomberg report,  “Boeing continues to lose money on each Dreamliner it builds” more than six years after the company was first supposed to begin delivering these next generation jets.

Wow …

“Boeing officials insist the 787?s assembly costs will continue to drop over time as workers improve the efficiencies of the line and the rate at which they can build new planes,” reporter Justin Bachman of Bloomberg noted.  “But the airplane – which suffered several delays before its 2011 introduction and then a grounding due to battery fires – remains a critical drag to the commercial airplane division’s financial performance.”

But Bachman landed a quote from a Boeing executive that doesn’t exactly inspire confidence.

Continuing to make progress. Still got a long way to go. We’ve got the enterprise engaged on how to capture productivity.

Yeah, six years later Boeing has the “enterprise engaged on how to capture productivity.” Sounds like everything should be just fine, right?

This website has no problem with Boeing (although the company clearly has a problem with us).  We’re glad the company is in South Carolina employing workers who contribute to the consumer economy.  We just don’t think taxpayers should have been forced to pay a $1 billion bribe to bring the company here – all so our state’s manufacturing facility could act as leverage in the company’s negotiations with its union.

All businesses should compete on a level playing field …