Plane-maker moves operations to facilities in Seattle, Oklahoma City and San Antonio
January 5, 2012
by The Canadian Press
WICHITA, Kan.—The Boeing Co. it will shut down its Wichita facilities by the end of 2013 and send work to plants in three other states as it deals with defence spending cutbacks.
The move will cost 2,160 jobs.
While the decision came as no surprise after Boeing announced the plan in November, it still drew angry response from Kansas lawmakers who say they helped the aircraft-builder land a lucrative military contract building refueling tankers for the Air Force.
Now that project is being sent to Boeing’s Seattle facilities.
Mark Bass, a Boeing vice-president, said the market for defence work has changed dramatically in the past 18 months and the Wichita facility wasn’t competitive because of its size and high labour costs.
The site includes 97 buildings with 190,000 square meters.
Bass declined to say how much the company expected to save by moving the work elsewhere.
Wichita had hoped the number of jobs at the facility would grow after Boeing won the contract worth at least $35 billion to build 179 Air Force refuelling planes.
Modification work on the planes was expected to generate 7,500 direct and indirect jobs with an overall economic impact of nearly $390 million.
But Boeing says 24 Kansas-based suppliers for the refuelling tanker project will still provide parts.
The first layoffs in Wichita are expected in the second half of 2012.
Seattle’s facility will build the tankers and handle their modifications while engineering work will move to Oklahoma City. Future aircraft maintenance, modification and support will go to San Antonio, Texas.
Together, the three states could pick up as many as 1,400 jobs, with Oklahoma City gaining 800 and San Antonio getting 300 to 400.
The Seattle area will add 200 tanker construction jobs but about 100 support positions from there will move to Oklahoma City in the shuffle, Bass said.
Wichita workers will be allowed to apply for jobs in the other locations.