Published January 2004

7E7 lands in Everett
Boeing to begin offering Dreamliner to airlines; execs say tax-incentive package
helped in site decision

By Bryan Corliss
Herald Business Writer

Turns out the “E” was for Everett all along.

Chief Executive Harry Stonecipher brought about 2,000 people to their feet Dec. 16 when he announced that the Boeing Co. will push ahead with plans to build its next-generation 7E7 in Everett.

“The 7E7 will be built right here on Puget Sound,” Stonecipher told a crowd of cheering Boeing engineers and mechanics at the Washington State Convention Center in Seattle.

“Let’s savor this moment,” a beaming Commercial Airplanes chief Alan Mulally told the cheering workers, who’d been bused into Seattle from Boeing plants around Puget Sound for the announcement. “This is the moment of a lifetime.”

The decision to pursue the Dreamliner was announced after Boeing’s board of directors approved the plans at a Dec. 15 board of directors meeting in Chicago.

There had been speculation before the meeting that the plan to build the jet in Everett would be a hard sell to a Boeing board eager to keep costs in hand.

But in the end, Stonecipher said the board was ready to approve the plan within the first 10 minutes. The discussion went on for four hours, he said, because an enthusiastic board peppered Mulally and 7E7 program chief Mike Bair with detailed questions.

The decisions to offer the plane to customers and to base the program in Everett both were unanimous, Stonecipher said.

“It wasn’t a debate. That’s because we love the airplane.”

And Boeing executives said the $3.2 billion state tax-incentive approved in June by the state Legislature helped tip the scales toward Everett, which was one of more than a dozen states to submit a bid.

Washington’s package, which cut the business and occupation tax rate in two stages and offered state research and development tax credits for aerospace design and engineering, balanced out the higher cost of doing business here, and made it possible for Boeing to consider its other strengths, Stonecipher said.

After that, Puget Sound’s skilled work force and the existing Boeing infrastructure sealed the deal, said Bair.

The good news brought tears to Craig Smith, an electrical engineer with the 7E7 development team in Everett. The chance to work on a new airplane is rare, he said. “You only see one or two in a lifetime, a career.”

And after years of layoffs and upheaval in Boeing, the announcement “gives us hope for the future,” Smith said.

Many workers have started to feel their days at Boeing were numbered, he said. “Now you can see a future maybe to take you through the end of your career.

“The company has made a decision to see the future and compete in the future. It’s excellent,” Smith said, then paused. “It’s just excellent.”

Local officials were jubilant. Outgoing Snohomish County Executive Bob Drewel handed out hugs and handshakes, and said the announcement felt like “just a sense of springtime for our region.”

“It’s a remarkable vote of confidence,” Drewel said, confidence that “we can work together, and we do understand that we have to work together.”

County executive-elect Aaron Reardon said the 7E7 site decision will be a springboard Snohomish County can use as it pursues other economic development opportunities in manufacturing, biotechnology — even stock-car racing.

“We’re the most competitive place in the country to do business,” Reardon said. “A lot of people thought early on this was a done deal in some other part of the country. We were not going to forfeit that.”

“Now we can go forth with a great deal of confidence that we’re going to have this economic engine at the top of the hill,” said Mukilteo Mayor Don Doran. “This is much more significant from a psychological standpoint than economically. Heck, who couldn’t feel positively about the future on a day like this?”

Machinists union district president Mark Blondin echoed those sentiments. The union has been working hard to land the 7E7 for the past year, he said, and it was tough going at first.

“A lot of people said, ‘It ain’t gonna happen, you’re wasting your time,’” Blondin said.

Some may be disappointed that new production arrangements will result in far fewer assembly line jobs, but “1,200 jobs are significant,” Blondin said. “We’re going to take the pieces they offer us and strive for more.”

Boeing executives touted the new plane’s attributes — wider, brighter and more comfortable for passengers to ride in; more efficient and versatile for airlines to operate.

“The 7E7 is truly a new airplane for a new and better world,” Bair said.

Boeing sees a potential market of 3,500 jets in this size over the next 20 years, and expects to beat Airbus in sales of midsize jets, Bair and Mulally said.

“The 7E7 is a real game-changer,” Stonecipher said. “Now let’s go sell it.”

The news is exciting for Boeing employees even if they aren’t working on the 7E7, said Tom McCarty, a Seattle-based engineer with Boeing’s defense division and the treasurer of the Society of Professional Engineering Employees in Aerospace.

“I feel we had to do this,” he said. “I really felt from the start this was the only decision they could make.”

“They’ve made a real commitment to the company and the work force,” McCarty added. “Boeing airplanes belong in the Pacific Northwest, period.”

Related: 7E7 aims for efficiency, comfort

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