Coronavirus pushes Boeing to halt 787 production in South Carolina
Some 7,500 employees will be impacted starting April 8th
Boeing CEO David Calhoun says it remains on schedule to certify the 737 Max.
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Boeing is suspending its operations for its 787 "Dreamliner" at its manufacturing facility in Charleston, S.C., the company announced Monday. The shutdown will take effect at the end of the plant's second shift on April 8.
Charleston, South Carolina, USA - February 28, 2020: Boeing South Carolina sign on the building in North Charleston, USA. (iStock)
"It is our commitment to focus on the health and safety of our teammates while assessing the spread of the virus across the state, its impact on the reliability of our global supply chain and that ripple effect on the 787 program,” said vice president and general manager of the 787 Program and BSC site leader Brad Zaback. “We are working in alignment with state and local government officials and public health officials to take actions that best protect our people.”
The announcement impacts approximately 7,500 employees who work in Boeing's Airport Campus, Interiors Responsibility Center, Emergent Operations department, and Propulsion department.
Monday's news follows the jet maker's decision on Sunday to indefinitely extend the closure of its Puget Sound production sites in Washington, which had been closed since March 23.
“The health and safety of our employees, their families and our communities is our shared priority,” said Boeing Commercial Airplanes President and CEO Stan Deal. “We will take this time to continue to listen to our incredible team and assess applicable government direction, the spread of the coronavirus in the community and the reliability of our suppliers to ensure we are ready for a safe and orderly return to operations.”
The company's Philadelphia-area sites went into a two-week shutdown on Friday, April 5 and at the beginning of the month, the Chicago-based company offered 160,000-plus employees early retirement and buyout packages in the face of declining revenue projections from the pandemic.
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South Carolina Gov. Henry McMaster announces he has added criminal penalties to his executive orders closing businesses, beaches and parks due to coronavirus at a news conference on Monday, April 6, 2020, in West Columbia, South Carolina. McMaster al …
Boeing's decision in South Carolina came the same day Governor Henry McMaster issued an order directing state residents to limit non-essential activity as a result of the coronavirus. According to the latest update by Johns Hopkins University, South Carolina has more than 2,200 confirmed coronavirus cases and 48 deaths.
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Boeing's South Carolina employees who can work remotely will continue to do so while those who can't will receive paid leave for 10 working days of the suspension, double the company's normal policy. After 10 days, employees will have the option to use a combination of available paid time off benefits or file for unemployment benefits through the state.
According to the company's press release, "all benefits will continue as normal during the suspension of operations" and "pay practice details have been made available to all teammates".
Planes are seen under construction at a Boeing assembly plant in North Charleston, South Carolina on March 25, 2018. The sparkling new Boeing 787s bound for China Southern Airlines and Air China are waiting to be delivered but the prospect of a trade …
During the suspension, Boeing will also continue to conduct "enhanced cleaning activities" at the site and "monitor the global supply chain as the situation evolves". Once the suspension is lifted, the company says that the 787 program will "take an orderly approach to restarting production with a focus on safety, quality, integrity and meeting customer commitments."
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FILE PHOTO: Grounded Boeing 737 MAX aircraft are seen parked in an aerial photo at Boeing Field in Seattle, Washington, U.S. July 1, 2019. REUTERS/Lindsey Wasson/File Photo - RC2OQF9OA216
Another question for the company is the fate of Boeing's 737 Max, which already created issues following two fatal crashes in Indonesia and Ethiopia last year. On March 24, Boeing CEO David Calhoun told FOX Business' Maria Bartiromo that plans to certify the 737 Max by the middle of the year and get it back in the air were still on track.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| BA | THE BOEING CO. | 149.29 | +5.88 | +4.10% |
Boeing has been active in the fight against the coronavirus, announcing on March 27 that it would produce face shields for health care workers on the front lines. The company's stock closed at $148.77 per share, up more than 19 percent during Monday's trading session, but fell slightly in after-hours trading.