Boeing Gearing Up in Carolinas

In a report Tuesday, Macquarie Securities analyst Rob Stallard wrote: "The acquisition will be viewed by many as Boeing admitting that it needs to take more direct control of the 787 production line, but we think it should increase the efficiency and seamlessness within the 787 supply chain.

"The purchase could also pave the way for a second 787 assembly line once Boeing ramps up production," Stallard wrote.

Scott Hamilton, publisher of an online newsletter that covers aircraft manufacturers, said the second line would likely be in North Charleston, where two plants already produce 787 fuselage sections with parts shipped from around the world.

One is the Vought plant, which Boeing has been actively managing since late 2007. An adjacent plant, which assembles the center section of the fuselage, is operated by Global Aeronautica, a 50-50 joint venture between Italy's Alenia Aeronautica and Boeing.

Hamilton cites two reasons for a North Charleston line. First, Washington state's deteriorating business climate and a history of union conflicts make it increasingly unattractive for Boeing, and, second, Boeing desperately needs a second 787 line.

Delivery delays, now at two years, "are costing Boeing billions of dollars in terms of compensation costs, cost overruns and deferred revenue," Hamilton says. "They need to start getting the program back on some semblance of a delivery track, and the only way to do that is to get a second line. "

Like most stories involving site selection for a major manufacturing plant involving hundreds of high-paying jobs, this one is filled with intrigue.