Boeing to close Kansas plant and drop 2,160 jobs

Company to move elsewhere to cope with defence cutbacks.

Comments Off on Boeing to close Kansas plant and drop 2,160 jobs January 5, 2012
by Canadian Press

Wichita, Kan. — The Boeing Co., for decades the brand that helped support Wichita’s claim as the aviation capital of the world, announced Wednesday it will shut down facilities in the city by the end of 2013 and send work to plants in three other states as it deals with defence spending cutbacks. The closure will cost 2,160 workers their jobs and end the firm’s presence in an area where it has been a major employer for generations.

The decision was not a surprise because Boeing said in November it was looking at closing the Wichita plant. But it still drew an angry response from Kansas lawmakers who helped Boeing land a lucrative Air Force refuelling tanker project in February and had expected thousands of jobs to come to Wichita with it. Instead, the tanker work will go to Boeing’s facilities near Seattle.

“Boeing’s announcement is that things have changed,” U.S. Sen. Jerry Moran said. “Well, the only thing that really has changed in my mind in the last year is Boeing now has the contract. When they made the commitments, they didn’t.”

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 2 million square feet (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 tankers. Modification work on the planes was expected to generate 7,500 direct and indirect jobs with an overall economic impact of nearly $390 million. Boeing said 24 Kansas-based suppliers for the refuelling tanker project will still provide parts as planned.

The first layoffs in Wichita are expected in the second half of 2012. While the Seattle area will build the tankers and handle their modifications, engineering work will move to Oklahoma City and future aircraft maintenance, modification and support will go to San Antonio, Texas.

The three states combined 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.

Boeing said it will continue to have a significant impact on the Kansas economy and its aerospace industry. The Chicago-based company spent more than $3.2 billion with 475 Kansas suppliers last year. Kansas is the fourth largest state in its supplier network.

Boeing has had a facility in Wichita since it bought the Stearman Aircraft Co. In 1929. Employment at the plant peaked during World War II, when its 40,000 workers included President Barack Obama’s grandmother Madelyn Dunham, who worked the night shift as a supervisor on the B-29 bomber assembly line. The company remained Wichita’s largest employer for decades after the war.
Associated Press writers John Hanna and John Milburn contributed to this report from Topeka.

© 2012 The Canadian Press