The Seattle Times Company

NWjobs | NWautos | NWhomes | NWsource | Free Classifieds |

Business / Technology

Our network sites | Advanced

Originally published September 9, 2008 at 12:00 AM | Page modified September 9, 2008 at 1:57 PM

Comments (0)     Print

Walkout's impact already forces big Boeing supplier to cut back

Spirit AeroSystems says it's cutting production on some Boeing parts as a result of the Machinists strike against Boeing, its largest customer.

WICHITA, Kan. — Spirit AeroSystems says it's cutting production on some Boeing parts as a result of the Machinists strike against Boeing, its largest customer.

The Wichita, Kan., company said Monday it will shorten the workweeks of some employees like it did during the Machinists' four-week strike against Boeing in 2005. President and Chief Executive Jeff Turner said the moves are necessary due to what he called "an unfortunate situation."

A majority of Spirit's employees on high-production, high-volume programs will be affected, spokeswoman Debbie Gann told Bloomberg News. She couldn't specify which parts were included in those programs.

Spirit will maintain normal production on other parts for Boeing and other customers, such as Airbus and Textron's Cessna planes.

Spirit was created from Boeing's sale of its commercial aircraft-parts operations in Wichita in June 2005. The Spirit plant makes nose-and-cockpit front fuselage sections of the 737, 747, 767, 777 and the new 787 Dreamliner, as well as the entire fuselage of the Renton-built 737s.

It also builds the struts that hold the engines on the wing and the pods that encase the engines for all current Boeing jets.

Machinists hit the picket lines Saturday, after contract negotiations broke off. About 25,000 Machinists in Boeing's factories around Puget Sound, some 1,200 in Portland, 700 in Wichita and about 70 at Edwards Air Force Base in California are on strike.

Boeing spokesman Tim Healy and Connie Kelliher of the Machinists union said both sides are ready to resume negotiations at any time, but no talks have been scheduled.

Meanwhile, an analyst said the strike at Boeing — which ranks at the top of the nation's leading industrial exporters in terms of dollar value — could show up in U.S. economic statistics.

"If it's a month long, you'll definitely see a blip" in trade-gap figures, said Richard Aboulafia, vice president and analyst for the Teal Group in Fairfax, Va.

Boeing failed to deliver more than two dozen planes on schedule during the monthlong walkout in 2005. This time, with about a seven-year order backlog and a scheduled delivery rate of more than 40 planes a month, the company stands to lose $100 million to $110 million a day in deferred revenue by most analysts' estimates.

In a news release Monday, Spirit noted that it endured the 2005 strike at Boeing without layoffs or work stoppages.

Spirit also said it is withdrawing its previous 2008 financial guidance as a result of the Boeing strike. The company said it will update its guidance when the strike is over.

Information from Bloomberg News and Seattle Times staff is included in this report.

Copyright © 2008 The Seattle Times Company

More Business & Technology headlines...

Print      Share:    Digg     Newsvine

No comments have been posted to this article.


UPDATE - 09:46 AM
Exxon Mobil wins ruling in Alaska oil spill case

UPDATE - 09:32 AM
Bank stocks push indexes higher; oil prices dip

UPDATE - 08:04 AM
Ford CEO Mulally gets $56.5M in stock award

UPDATE - 07:54 AM
Underwater mortgages rise as home prices fall

NEW - 09:43 AM
Warner Bros. to offer movie rentals on Facebook