Analysis: Boeing bidders dangle goodies to win 777X jetliner

Thu Dec 5, 2013 7:38pm EST
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By Alwyn Scott and Harriet McLeod

NEW YORK/CHARLESTON, South Carolina (Reuters) - South Carolina will clinch a long-awaited land sale next week that should help Boeing Co (BA.N: Quote) expand aircraft production. Perhaps more importantly, the $13.8 million deal may help South Carolina win assembly work for Boeing's next big jet.

The acreage near Boeing's assembly line in North Charleston is just one of a tantalizing collection of goodies that states across the country are dangling to try to lure the lucrative new jet program, known as the 777X, that promises thousands of jobs and billions of dollars in economic benefit to the winning state.

Boeing has requested proposals for the jetliner program from more than a dozen states after the unionized machinists in Washington state last month roundly rejected a labor contract that would have guaranteed the plane was built there.

Initial proposals are due next week, according to people familiar with the discussions.

In Missouri, lawmakers are meeting in a special session to consider tax cuts and other benefits for Boeing. Alabama government leaders are preparing to pitch Huntsville, where Boeing has extensive operations. California said it is working on a plan to meet Boeing's requirement. Georgia said it may offer two potential sites.

"We want it as bad as anybody else. And we can deliver it," said Paul Campbell, director of airports for Charleston County Aviation Authority, in South Carolina.

Making 267 acres available near where Boeing already builds 787 Dreamliners, "absolutely is a plus," Campbell said. "They could certainly use part of that property to build the 777X."

Washington state remains in the running. Lawmakers last month passed $8.7 billion in aerospace tax incentives to keep Boeing in the region where it already builds nearly all of its commercial aircraft.   Continued...

Boeing Chairman James McNerney (2nd L) shows United Arab Emirates' Prime Minister and Ruler of Dubai Sheikh Mohammed bin Rashid al-Maktoum (2nd R) a model of the new version of its 777 long-haul jet during the Dubai Airshow November 17, 2013. REUTERS/Ahmed Jadallah