SEATTLE -- On Wednesday, more than 30,000 members of the International Association of Machinists and Aerospace workers will make a choice. Do they vote yes or no on an unprecedented eight-year contract extension to land Boeing's 777X and preserve tens of thousands of jobs?
A lot of machinists are rallying for a no vote, citing changes in the pension plan, higher contributions to their health insurance, flat wage growth and slower progression for new hires to top wage scales.
Boeing says the machinists will continue to be ahead in wages and benefits than other workers and has gone as far as it can in offering more. The company is offering a $10,000 signing bonus and higher performance payments to try and swing the deal.
And on the eve of that vote, has the state passage of nearly nine billion dollars in tax incentives for aerospace ensured those jobs will actually remain here if that vote is yes?
These tax breaks are not going to Boeing unless A, the wing is made here in perpetuity, and B, all the derivatives of the model are made right here in the state of Washington, Washington Governor Jay Inslee said Tuesday.
That's why we want this confidence for machinists, should they decide to exercise their vote for this particular contract. It's the right thing for the state of Washington, Inslee added.
Some machinists are concerned while state incentives and contract language language may keep future 777s in Washington, they claim there's more wiggle room for the company to move other work out of state.
The governor is not advocating machinists vote one way or another. He says that's up to each individual machinist. But he's been told by the president and CEO of Boeing Commercial Airplanes Ray Conner that the company requires both the tax breaks and a positive vote by the machinists to keep the 777X program here without looking to other states for a bid.
We don't go into a Seahawks game planning on what we'll do if we lose, said Inslee. We're planning on winning.
The governor won't talk in terms of a plan B if the vote is no, but he's keenly aware of the competition.
Before this started, the Boeing Company had been contacted by 10 or 12 governors months ago, said Inslee, which is one of the reasons Inslee moved to extend tax breaks for the state's aerospace industry first introduced 10 years ago to land the 787 Dreamliner.
At $8.7 billion, the state's tax offer is eye popping. Almost 10 times what South Carolina offered to land a second 787 assembly line in Charleston in 2010. And that's not including what Washington state will spend for worker training in aerospace skills and financial assistance for cities, counties and local governments to speed building permits for large projects, such as Boeing's wing plant. That wing plant would construct what could well be the largest carbon fiber composite piece ever made: the 777X's wing. That cost is estimated around $10 million a year.
Overall, the governor expects the return on investment to be a threefold increase, bringing in some $21 million into state coffers through expanded business activity.
And it's that giant 777X wing that the governor is counting on to keep Boeing and the aerospace cluster of nearly 700 suppliers in Washington state.
I believe the 777X will increase, rather than decrease the reason for Boeing to build other models here, said Inslee.
He even sees more composite industries spinning off in other industries. Already, composite material made in a new plant in Moses Lake is used in BMW's new all electric car.
The contract extension would begin at the end of the current contract in 2016 and extend to September of 2024.