End of the line for the C-17. And 300 jobs in St. Louis?
by Tim Logan, St. Louis Post Dispatch
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The end of the assembly line for Boeing Co.’s C-17 cargo jet has been approaching for years. On Wednesday the company put a date on it.
The final C-17 will roll out of Boeing’s factory in Long Beach, Calif., in late 2015, with parts-making in St. Louis to end a few months before then. The move, which will eliminate 3,000 jobs across the aerospace giant’s workforce — including 300 here in St. Louis — and threatens 20,000 at suppliers, was all but inevitable as orders for the workhorse of the Air Force cargo fleet dried up.
“Ending C-17 production was a very difficult but necessary decision,” said Dennis Muilenburg, chief executive of Boeing Defense, Space and Security, in a statement. “Our customers around the world face very tough budget environments. While the desire for the C-17’s capabilities is high, budgets cannot support additional purchases in the timing required to keep the production line open.”
The news comes less than a week after Boeing delivered its 223rd and final C-17 to the U.S. Air Force, which declined to order more several times in recent years amid Pentagon belt-tightening and the wind-down of wars in Iraq and Afghanistan.
Boeing has extended production with a handful of international sales — including a $4.1 billion contract with India for 10 planes — but there’s only so much demand out there for these planes, said Loren Thompson, a defense analyst at the Lexington Institute, a Washington-area think-tank.
“The C-17 is an extremely capable aircraft, but most countries don’t have a need to move large military forces across continents quickly,” he said. “And for the U.S., you reach a point at which you have all the airlift you need.”
Boeing now has 22 C-17s left to complete, said program manager Nan Bouchard: Seven for India, two for an unnamed foreign client and 13 that it’s making without orders but hopes to sell. At 10 planes per year that’ll keep production running through late 2015. That’s it. Boeing had hoped to land enough international orders to keep assembly lines active, but came to the conclusion last week that was not going to be feasible. It told employees Wednesday at an all-hands meeting in Long Beach that was webcast in its other C-17 plants, including the one in Hazelwood.
Layoffs will likely start in the middle of next year, Bouchard said, as the final planes move through production. Boeing hopes to move as many C-17 workers as possible to other jobs.
“We’ll work with all of our employees to find them meaningful work in Boeing as much as possible once this program ends,” she said.
Gordon King, president of the District 837 of the International Association of Machinists in Hazelwood, said he was optimistic that his union’s 200 members who work on the C-17 would transfer to other programs.
“By the time it would affect our line, I don’t think it’ll affect our manpower all that much,” he said.
But the impact may hit suppliers sooner than that. About 650 companies in 44 states — including many small local manufacturers — make parts that wind up in a C-17. That work supports another 17,000 jobs, the company estimates.
It takes nearly three years to build a C-17 from start to finish and Boeing has spent $620 million from its own pocket, according to regulatory filings, to keep those parts coming even as it scrounged for more sales. Now those payments will stop.
And before too much longer, so will assembly of the C-17.
