How Unions Hurt Themselves: Boeing Builds 787s in South Carolina

Boeing said yesterday it would build an assembly line for its 787 Dreamliner in South Carolina, outside its historic civil aircraft manufacturing base of Seattle, after talks with unions in Washington state broke down.

The announcement is a serious blow to Washington state, where Boeing employs more than 200,000 people and generates about $36bn annually. In recent days, politicians had shuttled back and forth between the aircraft-maker and leaders of the machinists’ union in an attempt to forge an agreement that would persuade the company to locate its second 787 line in the region.

“I’m angry,” said Chris Gregoire, the state’s governor. “I think the company made the wrong decision.”

A machinists’ strike shut down Boeing’s commercial production for two months last year, exacerbating problems the company has had in getting to grips with the 787, its new widebodied, fuel-efficient jet.

Looking at the unemployment rate in Washington State (8.8% in September 2009) versus South Carolina (11.7%) it’s clear this was a huge blow to the former and a huge gain for the later.

What finally pushed Boeing over the edge?

The company was seeking a no-strike accord as part of any commitment to build a plant in Seattle, while the union was in turn demanding an extended series of predetermined pay rises.

Boeing is unlikely to face union militancy in South Carolina, a “right to work” state where workers cannot be forced to join unions. Part of the 787 fuselage is already made at a plant in Charleston that Boeing took over from Vought last year as it attempted to gain tighter control over the aircraft’s global production system. Workers at the facility voted last month against joining the machinists’ union.

So by trying their Big Union hardball tactics the bozos ended up losing a lot of jobs.  Congradulations to Boeing for making the right call!

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