Fact Sheet - Additional Details by Business Group
Boeing Commercial Airplane Group (BCAG)
Final assembly for ongoing Boeing commercial aircraft will remain in their current locations as Program Management Centers: 747/767 Programs and 777 Program in Everett, Wash., and the 737/757 Programs in Renton, Wash.
Long Beach, Calif., is a site in transition. As previously announced, the production in Long Beach of the MD-80 and MD-90 jetliners is currently expected to end in early 2000 because of insufficient market demand. This will result in the reduction of approximately 3,000 jobs associated with that program.
The MD-11, including final assembly, will remain in Long Beach, along with the 3,000 jobs associated with that program. The company is currently marketing the airplane to potential customers. The future of the MD-11 will depend on the success of these marketing efforts, and the company expects to have a clearer picture of the program's future later this year.
The 717 final assembly and delivery operations, along with some engineering and other resources required to support production, will remain in Long Beach as an Assembly, Integration and Test Center. Approximately 2,000 jobs associated with those functions will remain in Long Beach. Following certification, 717 program management functions will begin transitioning to Puget Sound. Approximately 1,000 jobs will be affected as a result of that action.
Customer support functions for all MD-series jetliners will begin transitioning to Puget Sound in 1998 and will continue transitioning for the next few years. There are about 1,000 jobs that will be affected.
The timing of decisions regarding the future of the Toronto facility, which primarily manufactures wings for the MD-11 and MD-80/90 jetliners, will depend on the long-term viability of the MD-11 program. There are about 800 jobs in Toronto that will be eliminated once MD-80/90 production ends.
The facility in Salt Lake City, which manufactures subassemblies for the MD-80/90 programs, will continue to produce parts for commercial jetliners as a Strategic Manufacturing Center. The company is currently in the process of identifying additional work for this facility, and the specific work packages will be finalized and announced over the next several months. The intent is to phase in new work in Salt Lake as the MD-80/90 production winds down, so there is minimal disruption to the facility.
The plant in Melbourne, Ark., which manufactures parts for MD-series jetliners, is currently undergoing a capability and capacity review to determine the feasibility of placing additional work there. A final decision will be made this summer.
As part of the company's realignment of facilities and programs, the Strategic Manufacturing Center in Oak Ridge, Tenn., will be transferred from Information, Space and Defense Systems (ISDS) to the Boeing Commercial Airplane Group as a Strategic Manufacturing Center. This decision reflects the fact that 90 percent of the facility's work is for Boeing Commercial Airplane Group (BCAG).
The Strategic Manufacturing Center in Corinth, Texas, which primarily makes wire bundles for commercial jets, will be transferred from ISDS to BCAG. The intent is to maximize efficiency by consolidating similar work and functions as much as possible under one organization. Corinth will continue to do both BCAG and ISDS work. The ISDS-managed wire shop in Mesa, Ariz., which also makes commercial airplane wire products, is working together with BCAG to strategically manage wire processes and products companywide.
Commercial airplane work currently performed at the ISDS facility in Philadelphia - primarily leading edges, slats, and some composite and machining work - will be phased out over time and transferred to BCAG.
Other existing sites in the Boeing Commercial Airplane Group will continue as planned with their current missions and programs as Strategic Manufacturing Centers.
Centralized BCAG functions in Puget Sound, such as marketing, enabling technology R&D, business resources, supplier management, etc., will remain as they are today.
Information, Space & Defense Systems (ISDS)
The Information, Space & Defense Systems (ISDS) group strategy involves six key elements:
- 1. Maintain ISDS group headquarters in Kent, Wash., with four major business units consisting of Aircraft & Missile Systems, headquartered in St. Louis; Space Transportation, headquartered in Seal Beach, Calif.; Information & Communications Systems, with headquarters in Kent, Wash., and Phantom Works, headquartered in St. Louis.
- 2. Establish focused Program Management Centers (PMCs) with responsibility to design, develop, assemble, integrate and test final products. Some Program Management Centers will be supported by focused Assembly, Integration & Test Centers (AITs).
- 3. Establish world-class Strategic Manufacturing Centers (SMCs) that will focus company investments in capital, manufacturing technology and training resources in those manufacturing processes that discriminate Boeing from its competitors.
- 4. Establish a major aerospace logistics and support center for large aircraft to support the long-term strategy to be the aerospace industry's pre-eminent provider of defense-based maintenance and modification services.
- 5. Establish focused laboratories that support all PMCs, AITs and SMCs by concentrating on Boeing core competencies' enabling technologies.
- 6. Establish partnerships with suppliers to provide subsystems, assemblies, parts and materials in support of Boeing core competencies.
Consolidated and focused laboratories will be established to support business units for such disciplines as material and processes, electronics, propulsion, radar signature, aerodynamics/structures, simulation, environmental/technical and metrology. Boeing will close test laboratories in Tulalip, Wash.
For the last several years, Boeing has worked to develop a long-term plan to focus resources on strategic and core products. Some types of work have been identified as non-strategic and/or not related to a Boeing core competency. Work that is no longer considered to be strategic to ISDS and that could be made available for partnership with suppliers includes:
- Sheet metal
- Small, non-strategic machined parts
- Small, non- strategic composites
- Non-strategic tooling
This will be accomplished after a thorough evaluation and coordination with union leadership that adheres to all contractual stipulations and applicable laws, and is consistent with the Boeing plan to partner with world-class suppliers.
Shared Services Group
The Shared Services Group provides common services across the company in an innovative and effective manner in order to give Boeing a competitive advantage. The group has been established initially in four major locations to serve the largest concentrations of Boeing employees: the Puget Sound region of Washington; Wichita, Kan.; St. Louis; and Southern California. Starting in 1998, it will expand to the rest of the company.
Its services range from computing services, telecommunication and information management to basic services such as security, transportation, facilities and purchase of non-production goods and services. It also gives direction to safety, health and environmental planning; manages companywide services to hire, develop and motivate employees; and offers comprehensive travel services to Boeing employees and corporate customers through the Boeing Travel Management Company.
Major activities focus on consolidating computing assets and companywide systems, standardization of processes across the group, combining like service functions and leveraging its purchasing power with suppliers. The goal: better, faster and cheaper.
Targeted merger synergy opportunities for the Shared Services Group include:
- Leverage buying power with non-production suppliers, focusing on key suppliers.
- Consolidate data centers from ten to three.
- Implement common computing desktop standards that will improve productivity and reduce support costs.
- Consolidate three data, voice and video networks into one integrated network.
- Standardize companywide timekeeping, payroll and human resources applications.
- Reduce travel costs through a unified, leveraged approach.