Posts Tagged: Boeing

Conventional labor disputes

Chicago's McCormick Place

Even as both private and public sector unions lose power, labor is a powerful force in Chicago. But Illinois politicians — even Democrats who get union contributions — argue that AFL-CIO unions like the carpenters and the teamsters keep the city from seeing millions, maybe billions, of revenue at the McCormick Place convention center. But, like the dispute between Chicago-based Boeing and the machinist union, federal law has so far sided with labor.

Chicago goes to Washington

Paul Merrion of Crain’s Chicago Business breaks down which Chicago companies did the most lobbying in Washington, D.C. during the second quarter. Defense contracting behemoth Boeing unsurprisingly did the most, spending about $4.4 million on lobbying efforts. The Exelon Corp. energy company was second, with $1.6 million.

What the numbers show is that while major companies have a full staff of lobbyists, lobbying expenditures wax and wane depending on whether the company has specific business in Washington. Boeing, for example, spent a lot more on lobbying while trying to procure a $35 billion tanker deal from the Air Force.


How will Boeing’s fight with labor play in Chicago?

The Washington Post’s Michael Fletcher and Jia Lynn Yang have a good piece on the politics of the National Labor Relations Board’s lawsuit against Boeing for moving an assembly plant from Washington state to South Carolina. The suit contends that Boeing moved the plant as to not have to deal with unionized workers — South Carolina is a so-called right to work state.

There’s a Chicago angle here, as Boeing is headquartered in the Windy City and Boeing Chief Executive Jim McNerny is head of President Obama’s Export Council. Chicago, on the other hand, is one of the strongest union cities in the country, so it bears watching how local officials here react as anti-labor accusations against one of the city’s largest companies move forward.

Airplane!: The inspection

As you may have heard, a Southwest Airlines Boeing 737 recently landed in Sacramento — with a five-foot fuselage tear along the roof. Consequently, the Federal Aviation Administration wants Chicago-based Boeing to inspect all 400-500 of their 737 planes, Reuters reports. These are some of the older planes in the Boeing fleet: the model with a fuselage hole had been around 15 years and flown about 39,000 times.

It’s over

It looks like we can finally stick a fork in the nine-year battle between Boeing and EADS for a defense contract to build midair refueling tankers. Boeing won the contract 10 days ago and Paul Merrion of Crain’s Chicago Business reports that EADS won’t challenge the victory.

The last two times the Pentagon awarded the midair refueling tanker contract the losing party, successfully, challenged the decision. So why is EADS backing off? Probably because Boeing submitted a $31.5 billion bid a healthy 11 percent cheaper than the final offer from EADS.

Boeing’s big score

Midair refueling tanker

The Air Force has rewarded Chicago-based Boeing a contract that could exceed $100 billion to build midair refueling tankers. Boeing won over the European Aeronautics and Defense Space Co., or EADS, which has a production factory in Alabama. The two companies have battled for a decade over the tanker deal — and the fight might not be over. Alabama Sen. Richard Shelby, never a fan of the Obama administration, said that “Chicago politics” fueled Boeing’s victory.

Shelby is apparently right to be surprised. (more…)

Refueling a defense contracting dispute

midair refueling tanker

In the latest twist in a ten-year controversy over a $35 billion defense contract for midair refueling tankers, seven U.S. senators want Pentagon Inspector General Gordon Heddell to investigate whether the Air Force has given European Aeronautic Defense and Space Co., or EADS, an unfair advantage over Boeing. Boeing is based in Chicago and so it is no surprise that one of the seven lawmakers is Illinois senior Senator Dick Durbin, a Democrat. Also calling for an investigation are Patty Murray, a Democrat from Washington, and Jerry Moran, Republican from Kansas: both these states have large Boeing operations that employ thousands.

Unclear, though, is what exactly these senators want “investigated.” (more…)

Defense contracting made difficult

aerial refueling

In the latest chapter of a veritable Russian novel on defense contracting,  The World Trade Organization will make a confidential ruling Jan. 31 on whether Chicago-based Boeing benefited from federal aviation subsidies, Reuters reports. The WTO ruled in June that Boeing competitor Airbus — a subsidiary of European Aeronautic Space and Defense Company, based in France — received illegal European Union subsidies.

The WTO investigation stems from a now decade-long dispute between the two defense contracting behemoths over who gets to supply the U.S. Air Force with midair refueling tankers, also known as “gas stations in the sky.” (more…)

Pentagon somewhat responsibly showers Boeing with cash

In what the Obama administration has billed as a cost-cutting move, Chicago-based Boeing has inked a four-year, $5.3 billion deal with the Defense Dept. to make 124 fighter jets and electronic attack planes. Reuters reports that both the Pentagon and Boeing claim that the contract will generate more than $600 million in savings because it lets Boeing and its subcontractors “buy materials in bulk, making production more efficient than under a single year contract.” It is also a fixed-price contract, meaning Boeing cannot get more taxpayer money if the company says that the project is more expensive than anticipated. (more…)

Turbulence for Boeing

It has already been a rough year for Boeing due to the Great Recession and a Pentagon “efficiency drive” that may threaten some of the Chicago-based company’s defense contracts. Now the World Trade Organization has ruled, according to European Union officials, that Boeing got more than $10 billion in illegal assistance from both the Pentagon and NASA for research and development of aircraft. Also, Boeing received illegal aid from the state governments of Illinois, Washington, and Kansas, reports Jonathan Sterns, Jennifer M. Freedman, and Andrea Rotham of Bloomberg News.

The news is “according to EU officials” because the WTO ruling is not released to the public until next year. (more…)