Boeing Gearing Up in Carolinas

Updated from Tuesday, July 7

CHARLOTTE, N.C. -- Now that it has agreed to buy a South Carolina plant that fabricates major parts for the 787, Boeing(BA Quote) could be on a path to establish a new 787 assembly line in that state as well.

Boeing said Tuesday it will pay $580 million for the Vought Aircraft Industries plant in North Charleson, where Vought fabricates and assembles the rear fuselage sections for the long-delayed aircraft. Boeing will also release Vought from repaying unspecified advances.

Many view the deal as the first step on the path to Boeing's creation of a second line in North Charleston, complementing the current line in Everett, Wash. It's no secret that Boeing has had some labor issues in its current location.

At the Paris Air Show last month, CEO Jim McNerney said Boeing was "actively looking" to establish a second line, according to Aviation Week.

On Tuesday, Boeing spokesman Jim Proulx said no decision has been made on a second line, noting: "Our main priorities on the 787 program right now are to work through the recently announced postponement (and) to move toward production ramp up."

Proulx said the 787 jetliner taxied under its own power Tuesday for the first time in its development, the Associated Press reported. He said the low-speed taxi test at Paine Field near Everett, Wash., was the first time the plane has moved under its own engine power. Previously, tow trucks had moved the aircraft.

The Vought purchase is expected to close in the third quarter, pending approval by the company's investors. The deal will enable Boeing "to accelerate productivity and efficiency improvements as we move toward production ramp-up," said Scott Carson, CEO of Boeing Commercial Airplanes, in a prepared statement. For Vought, "the financial demands of this program are clearly growing beyond what a company our size can support," said CEO Elmer Doty.