Biz

Boeing’s Production Problems Hurting Bottom Line

BUT DON’T EXPECT TO READ ABOUT IT IN A SOUTH CAROLINA NEWSPAPER 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…

BUT DON’T EXPECT TO READ ABOUT IT IN A SOUTH CAROLINA NEWSPAPER

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 …

***

Related posts

Biz

Blackbaud Confirms It Is Being Targeted For Acquisition

Will Folks
Biz

‘Bidenomics’ Jobs Report: Not All It’s Cracked Up To Be

Will Folks
Biz

Guest Column: ‘Bidenomics’ Is A Nightmare For Consumer Costs

FITSForum

10 comments

Preaching to a small choir October 23, 2014 at 10:06 am

“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.”

Amen brother.

Cue the litany of “they won’t come here otherwise” responses from the usual statist/crony capitalist suspects.

They can’t even distinguish the difference between reducing taxes for incentive versus handing out taxpayer money, let alone understand how incentivizing extreme tax reduction can be to a company like Boeing if done properly, avoiding the whole issue of moral hazard.

Reply
Deo Vindice SC October 23, 2014 at 10:57 am

There is not enough educated people in SC to make the product, we’ll pay for it instead, and promote our achievement.

Reply
The Colonel October 23, 2014 at 11:05 am

“…This website has no problem with Boeing…” Come on Will, you’ve had a “hard on” for Boeing since day one – I think you’ve written one semi-favorable thing about the company and it was a left handed compliment at best.
“… (although the company clearly has a problem with us)…. I doubt they care about you at all. Though we are sure they know you exist, what with the trespassing and all…

Reply
Karadion October 24, 2014 at 3:14 pm

Actually Will lied about his encounter with Boeing. He drove up to the front gate sitting in the marked no-crossing median on Boeing Blvd, got out of his car, snapped pictures, and they told him they couldn’t do that. So he deleted the pictures in front of the security guard which they were fine. Then he did a U-Turn while snapping another picture. There’s also a reason why Will didn’t press charges against Allied Barton claiming assault. Because they are recording the front gate and actually do have a recording of the “incident”.

Then of course he went on his blog and made up the incident about the security guard supposedly deleting the video of his daughter when they didn’t touch his phone at all.

Reply
CNSYD October 25, 2014 at 9:41 am

Captain Renault is shocked to learn Will Folks would make up an incident and report it as fact.

Reply
west_rhino October 23, 2014 at 12:14 pm

so Will, with that slant on this story, what percentage of the airframes with issues have come from the “SOLID UNION” workforce in the plants in Washington state? Just askin’

Reply
Karadion October 24, 2014 at 3:11 pm

Are you talking about the 787? Most 787 issues have come from Everett. The Ethiopian plane that was on fire from a defective Honeywell unit? Everett. The ANA and United planes with the battery cascade runaway reaction? Everett. The panel falling off the Air India 787? Everett.

Reply
CNSYD October 25, 2014 at 9:43 am

How many times do you have to be told that facts are not appreciated by Will. They mess up his agenda.

Reply
CNSYD October 23, 2014 at 2:30 pm

For the 1000th time Will continues to ignore the “market place” competitor to Boeing. It is Airbus owned by European governments. There ain’t any others. For once Will, tell the truth. But I know you won’t as truth doesn’t fit your agenda.

Reply
Karadion October 24, 2014 at 3:10 pm

As usual, the lie continues.

The reality is that South Carolina has given directly a lot less than that.
Money from the State:
$270 million in up front money from the state. (Another $129 million for borrowing)
$33 million for worker training program

Money that Boeing does not pay due to tax breaks
$356 million in property-tax breaks (taxes that Boeing won’t pay to the state on property taxes. Charleston County Aviation Authority is a state charter organization).
$47.5 million in state corporate tax credits
$100 million in additional tax breaks for components that are flown into and out of Charleston. If they didn’t fly components into or out of
Charleston, the tax effect is still $0 before or after the fact.

Reply

Leave a Comment