Boeing News
Boeing Acquires Dreamliner Parts Plant
The Wall Street Journal (7/8, B3, Sanders) reports, "Boeing Co. agreed to acquire manufacturing operations from one of its key suppliers on the delayed 787 Dreamliner aircraft at a cost of $1 billion." The acquisition of the "plant in North Charleston, S.C., from Vought Aircraft Industries would mark the second time Boeing has taken over a key part of the Dreamliner's supply chain." Under the deal, "Boeing is paying $580 million in cash and will forgive $422 million in cash advances paid to privately held Vought for work on the 787." The AP (7/8, Lovering) says, "Vought, owned by private equity firm The Carlyle Group, claims financial problems, not production glitches, prompted the sale, which is expected to close in the third quarter."
Noting that "the Boeing Company celebrated its new 787 Dreamliner as not only a state-of-the-art plane, but as a model of how to streamline its production process by relying on outsourcing", the New York Times (7/8, B4, Drew) adds "on Tuesday, the company took a step away from that vision." The plane maker "has already had to contend with other supply and production problems on its delayed 787 Dreamliner, a model considered crucial to the company's future. It recently postponed its first test flight and has faced bottlenecks at Vought and other suppliers." Bloomberg News(7/8, Ray) adds, "The 787's entry into service has been set back five times, in part because multiple suppliers didn't do all the work they had agreed to, leaving more for Boeing workers to complete."
The Fort Worth (TX) Star-Telegram(7/7, Cox) reported the transaction "indicates that [Boeing's] new way hasn't gone so well." According to an industry watcher, "this is the first time Boeing has ever been this far off on an airplane development program." Under the deal, "nearly 400 Dallas-based engineers and other Vought employees have been working on the 787 program. They will become Boeing employees when the deal is completed, which is supposed to occur within 30 days." The Star-Telegram also reported on "widespread speculation that Boeing will now take over full ownership of the Global Aeronautica plant adjacent to Vought's facility in North Charleston by buying out its Italian partner, Alenia."
According to the Financial Times(7/8, Weitzman), "the difficulties with the 787 have come as airlines are suffering from the global economic downturn and the lack of access to credit. Qantas, previously the 787's biggest customer, last month cancelled orders for 15 aircraft and delayed delivery of another 15." Boeing objective is "to produce 10 787s a month by 2012," and the company "has said it is considering a second final assembly line somewhere in the US to allow it to increase rates further."
