Boeing Picks South Carolina - The State newspaper in Columbia, S.C., reported: "Establishing a second 787 assembly line in Charleston will expand our production capability to meet the market demand for the airplane," Jim Albaugh, chief executive of Boeing Commercial Airplanes, said in a news release. "This decision allows us to continue building on the synergies we have established in South Carolina." Read more here.
Seattle Sleeps - Seattle-based McGraw-Hill Construction editor Lucy Bodilly wrote about the Seattle perspective in her blog post, "Boeing Move to South Carolina Surprises No One." Bodilly wrote: "Washington state could go to a Halloween party with an egg taped to its face, after Boeing Co. announced its decision to build the new 787 production line in South Carolina, instead of in Everett, Wash. Gone are the millions of dollars that could have been awarded to local contractors that would have been busy building the new facility along with as many as 3,800 permanent, high-paying jobs.... Given the choice, wouldn’t new businesses move where there are no labor unions, lower wages and taxes and fewer governmental regulations? Some place like South Carolina?" You can read more of this blog, and its numerous spirited comments, here.
The Impact on South Carolina. There is no doubt that the state of South Carolina has needed substantial economic development for years. Aviation Week--which, like Southeast Construction, is published by the McGraw-Hill Cos.--published its take on the impact of Boeing's announcement on the state in "S.C. Hopes 787 is Just the Start." Aviation Week's Joseph Anselmo writes: "An economic development package approved by the South Carolina legislature on Wednesday assumes the project will create at least 3,800 jobs and $750 million in investment within seven years. But the IAM claims that is 'more than three times as many jobs' as Boeing needs for a second 787 line — raising the question of whether the company intends to locate other aircraft work in South Carolina in the future." Here's a link to this Aviation Week story.
Credit the Incentives. Just before Boeing's announcement, South Carolina's state Senate approved $450 million in incentives. The Associated Press reported: "The Finance Committee OK'd low-interest construction bonds and incentives that include a sales tax exemption on fuel used in test flights.... 'We've got an opportunity before us now ... to bring jobs to our people that are so desperately needed,' said committee chairman Hugh Leatherman, R-Florence." Read more about it here.
Credit 'Southern Gentility'? According to The Herald of Rock Hill, S.C., "South Carolina won Boeing's new assembly line for the 787 Dreamliner despite the company's last-minute request for $37 million, losing out on Boeing's first 787 assembly line six years ago, doubts about the state's workforce and South Carolina's political friction." U.S. Sen. Lindsey Graham, who acted as a go-between in the Boeing-South Carolina negotiations, credited "Southern gentility" as a main factor in the final decision. Sen. Graham should know "gentility." After all, in contrast to South Carolina Rep. Joe Wilson, who chose to shout "You lie!" at President Obama during his health-care address to both houses of Congress -- thus breaching all imaginable definitions of the word 'gentility' -- Sen. Graham's memorable, caught-on-video moment from the same event was to almost applaud during President Obama's speech. He even deferred to President Obama in his vote to approve Judge Sonia Sotomayor to the U.S. Supreme Court, breaking with many of his Republican colleagues to do so. In this day and age, is that "gentility" or what?!
Seriously, apparently the Southern gentility thing was playing out internally. Reported the Herald: "Lawmakers and lobbyists said they have never seen the leaders of the House and Senate work so cooperatively together as on the Boeing project. What else but the state's largest economic-development deal would have Gov. Mark Sanford praising one of his chief nemeses, state Sen. Hugh Leatherman, R-Florence? ... State leaders each played a role, stopped politicking and kept their mouths shut, state Commerce Secretary Joe Taylor said." You can read more about South Carolina's charm offensive here.
Give Credit Where Credit is Due. While South Carolina's nonunion workforce, lower wages, more favorable business environment and $450 million in incentives were certainly factors in Boeing's Dreamliner plant decision, it shouldn't come as a real surprise to anyone that South Carolina was able to win the battle with Seattle. It's been 17 years since the state landed BMW's manufacturing plant, but that investment has proven its worth over the years. Reported the Associated Press: "When BMW decided in 1992 to build in Spartanburg County, it promised to create 2,000 jobs and invest $500 million. The company estimates its investments through last June at $6.3 billion - including $2.1 billion through suppliers. It now employs 5,000." (Additionally, a related 787 facility was already located in North Charleston.) So the state's proven that its workforce is capable of supporting these companies. Read more here.
(I've also posted a blog about Gov. Sanford's philosophical dislike of government incentive packages. You can read about the governor's deliberations here.)
With permits already in hand, work could begin as early as this month, Bodilly reports. Southeast Construction will stay on top of developments, through construction, of course. In the meantime, follow us on Twitter.
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