What would be nation's largest defense deal with a U.S. contractor, for the purchase of 10 C-17 military cargo jets, will extend work at Boeing's Long Beach plant through 2014.
A C-17 cargo jet is produced at Boeing's
factory. Long Beach ’s government has approved the purchase of 10 C-17 military planes for $4.1 billion. The deal would give workers at the India plant one year of new work. In January, Boeing said it was cutting 900 of the plant's 3,700 jobs.(Bob Chamberlin, Los Angeles Times / June 7, 2011) Long Beach
By W.J. Hennigan,
Times Los Angeles
The deal should keep things humming at the sprawling plant through 2014, Boeing spokesman Jerry Drelling said.
All that remains to make it official is for the two governments to sign a letter of acceptance, which Boeing said it hopes will be completed by the end of the week.
"We're still waiting on the signatures, but the deal is 99.9% done," said Stan Klemchuk, president of the United Aerospace Workers Local 148, which represents 1,600 workers at the Boeing factory. "Folks are buzzing in
In January, Boeing said it was cutting 900 of the 3,700 jobs at the plant. Last year, with slowing orders from the Pentagon, the
The slower production rates would also buy time for the company to sell more planes to foreign buyers, Boeing had said. The production line had been slated for closure at the end of next year.
"This deal keeps the line open for more sales to come to fruition," Klemchuk said. "It gets us through a crucial time."
The C-17 Globemaster III, a massive, four-engine jet that hauls 60-ton tanks, troops and medical gear across continents and lands on short runways, has been in production since the early 1990s. The Boeing plant, next to
The plane has been a workhorse in hauling supplies to
Boeing has sold the aircraft to foreign governments in the past, but mostly to close allies and in small batches. Britain, Australia,
But because these orders are small — about five planes at a time — they have not been enough to sustain the production line, Boeing said. The company has relied on the Air Force to extend its orders every year since 2006.
Congress has continually come to the program's rescue because it supports roughly 25,000 supplier jobs in 44 states. Boeing said that in California, about 14,000 jobs — many at small mom-and-pop machine shops — depend on the program.
Last year, lawmakers provided funding for 10 new planes. But this year analysts have said congressional concerns about rising federal deficits may make continued C-17 funding doubtful.
The India deal could open a new business market and signifies a budding trade relationship with the U.S. Indian officials have said the country expects to buy six more C-17s in the coming years.
Seeing the potential for greater trade with
Once the C-17s have been delivered, "
Tom Captain, aerospace analyst with Deloitte, said
"It's unprecedented for a foreign country to spend that much money in that short of a time period," he said. "The country is now leaning more toward the Western world for its arms."