Boeing To Build Its First Offshore Plane Factory In China As Ex-Im Bank Withers

[jpak]

Source: Forbes

Facing severe pressure from state-subsidized foreign competitors and the end of federal export financing, Boeing has decided to throw in the towel. After a hundred years of producing its commercial aircraft exclusively in the U.S., the nation’s largest exporter will build its first offshore aircraft plant in China.

The new plant will be a joint venture with a Chinese entity to install interiors and paint exteriors on 737 airliners, Boeing’s popular single-aisle jetliner that competes with the Airbus A320. China’s official Xinhua news agency reported yesterday the company has signed a huge deal for 300 737s with three Chinese companies, besting the record 250-plane deal that Airbus received for its A320 last month from low-cost Indian carrier IndiGo. The news agency report coincided with the visit of Chinese president Xi Jinping to Seattle, the home base for Boeing’s commercial aircraft operations.

Company insiders say the precise location of the new plant in China has not yet been decided, but it appears the uncertain fate of the U.S. Export-Import Bank figured in the decision to establish offshore production. All of the 737s airframes destined for China will still be built in Renton, Washington at the plane’s main assembly facility, and then finished at the new plant. But the relationship with China is likely to grow over time, because China, like Brazil, Canada, France, Germany, Japan and every other industrialized country (except now the U.S.) assists plane exporters in securing financing.

China’s rapid economic growth in recent years dictated that Boeing take steps to increase its presence there. The company estimates Chinese carriers will buy or lease 6300 commercial transports over the next 20 years, and 4800 of those will be single-aisle jetliners like the 737 and A320. Airbus began delivering A320s from a Chinese plant in 2009, and signed an agreement this summer to build a second such facility in the country. Boeing can’t afford to be left behind in the trillion-dollar Chinese market, and the Beijing government has been eager to attract the kind of high-tech manufacturing its products entail.

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Read more: http://www.forbes.com/sites/lorenthompson/2015/09/23/boeing-to-build-its-first-offshore-plane-factory-in-china-as-ex-im-bank-withers/

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Thanks GOP for shipping our jobs overseas

not

[FBaggins]

1. This while Airbus is shifting manufacting *IN* to the US?

Something doesn't make sense.

[Sen. Walter Sobchak]

4. Airbus needed to build a new A320 line somewhere

They didn't have enough space in Toulouse or Hamburg. Airbus planned on building A320's in the US from the very beginning through a partnership with McDonnell Douglas.

[FBaggins]

10. But they're saying that the US line will produce the cheapest A320s

They even claim that it's cheaper than if they built a line in China.

[Sen. Walter Sobchak]

13. They did build a line in China

It's in Tianjin.

Airbus has wanted to build in the US for a generation both to secure more favorable treatment from an often protectionist US government and to buffer itself from currency issues.

[liberal N proud]

2. 777 copy cats to come

[Sen. Walter Sobchak]

5. The Chinese are already building knock-off DC-9's

On the assembly line for the MD-80 and MD-90 that was build in China by McDonnell Douglas. Although in fairness had Boeing and McDonnell Douglas not merged the legitimate licensed production probably would have continued.

[florida08]

3. Disgusting to say the least

Vulture capitalism must stop. Destroying lives for increased profit is the lowest thing there is

http://www.rawstory.com/2015/09/ex-hedge-funder-buys-rights-aids-drug-and-raises-price-from-13-50-to-750-per-pill/

[justhanginon]

6. I think if they are doing the plane interiors we should

maybe look askance at that portion of the build. Didn't they have a little problem with tainted drywall they shipped to this country a few years back? Maybe they can find a way to recycle it into the plane interiors. I think they have some left over laminate flooring also.

[saturnsring]

12. and drywall and everything the chinese made , full of poison

[Sen. Walter Sobchak]

7. I'm not a fan or Boeing or EXIM

I think Boeing is just a worthless rotting shell, but this move was just unilateral disarmament. Export financing is sleazy everywhere.

[Skwmom]

8. More likely China demanded the plant b/c it's buying 300 planes.

Shukor, with Malaysia-based Endau Analytics, said China was unique in that orders came from the government and planes were then distributed to the airlines and leasing companies.

"To put it simply, it's a trade-off," he told AFP. "China buys 300 aircraft and Boeing builds a plant in China in return."

Shukor said China was leveraging the rivalry between Boeing and Airbus to get the best of both worlds in developing its own aircraft manufacturing.

http://news.yahoo.com/boeing-sets-300-plane-order-plant-china-report-093248011--finance.html

[Skwmom]

9. Your link doesn't work. n/t

[bahrbearian]

11. After the State of Washington gave Boeing a 9 billion tax cut

not to move the new 777 production out of state. Now Inslee wants to raise the gas tax 10 cent gallon.

after Boeing got their deal the moved 2000 engineers out of state.

[pnwmom]

16. It was worse than that. Boeing laid off thousands of engineers --

they didn't move them out of state.

They hired new engineers out of state, and 40% of them were fresh out of school.

[Locrian]

14. they're deslusional.....

The company estimates Chinese carriers will buy or lease 6300 commercial transports over the next 20 years, and 4800 of those will be single-aisle jetliners like the 737 and A320.

The "growth" that would make this happen is impossible both economically and environmentally.


http://www.earth-policy.org/data_highlights/2011/highlights18

http://www.truth-out.org/news/item/31478-china-s-communist-capitalist-ecological-apocalypse

[pampango]

15. Another FDR creation, the Ex-Im Bank, bites the dust. The tea party reps killed it in Congress.

I doubt the Tea Party repbs care about the repercussions. They thrive on 'cut the government'; not on 'what happens after you cut government'.

House Dems bullish on Export-Import Bank

House Democrats say they’re confident lawmakers will reauthorize the federally backed Export-Import Bank — they just don't know when.

Conservatives have vehemently opposed the bank, whose charter formally lapsed June 30. They argue that it uses taxpayer funds to finance politically connected corporations like Boeing and General Electric, the latter of which announced earlier this month it would move nearly 500 U.S. jobs overseas as a result of Ex-Im's charter lapsing.

Democrats and moderate Republicans are adamant they have the votes to reauthorize the bank, which they say sustains millions of U.S. jobs by helping to finance projects the private sector wouldn’t otherwise enter.

Rep. Maxine Waters (D-Calif.), the top Democrat on the House Financial Services Committee, said that Ex-Im supporters have enough votes. She criticized conservatives for attempting to block such a vote.

http://thehill.com/policy/finance/254514-house-dems-bullish-on-ex-im

[Demeter]

17. The US Industry Could Survive Very Well Without ExIm Bank

They have the cash.

This is a good way for Boeing to destroy its favorite status with Congress. See if Congress ever grants it another favor.

Greed overrides sense.

[proverbialwisdom]

18. BLOOMBERG TV-> Boeing gets a $38 billion jet order; China gets a factory

http://www.bloomberg.com/news/articles/2015-09-23/boeing-china-swap-jet-deals-as-xi-s-visit-underscores-stakes
http://www.bloomberg.com/news/videos/2015-09-24/china-boeing-ink-two-deals-during-xi-visit