Boeing to shift most defense work out of Washington state

Mon Sep 29, 2014 8:04pm EDT
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By Andrea Shalal and Alwyn Scott

WASHINGTON (Reuters) - Boeing Co (BA.N: Quote) on Monday said it would move the majority of its defense services and support work out of Washington state to other U.S. cities, affecting the jobs of about 2,000 of its 5,200 defense employees in the Puget Sound region.

The changes, first reported by Reuters earlier Monday, are part of ongoing efforts by Boeing to streamline its defense business, and will not affect its P-8A spy plane or KC-46 aerial refueling tanker programs. Both of those programs are based on commercial jetliners made in the area.

Boeing said the transition could take three years to complete and that it would shift as many affected workers as possible to the company's growing commercial jetliner operations.

Chris Chadwick, chief executive officer of Boeing Defense, Space and Security, said the decision was difficult but necessary to improve the company's competitiveness.

"This is necessary if we are going to differentiate ourselves from competitors and stay ahead of a rapidly changing global defense environment," Chadwick said.

Union officials said the company has scheduled meetings with defense workers at key sites in the Puget Sound region on Tuesday and that managers and workers expect the company to announce work will be transferred to other parts of the country.

The state said the blow would be softened by its efforts to help its hundreds of defense suppliers adapt to declining U.S. defense spending.

"It's disappointing but we've done a lot to mitigate the impact," said Alex Pietsch, director of the state office of aerospace.   Continued...

The Boeing logo is seen at their headquarters in Chicago, April 24, 2013. REUTERS/Jim Young