Boeing goes outside for 787 parts delivery

Boeing announced Thursday a non-union contractor will manage the delivery of airplane parts to the 787 assembly line to be set up in Everett next year, work traditionally done by members of the Machinists union.

The work will go to North Carolina-based New Breed Logistics, which is scouting sites near the factory for a 100,000-square-foot warehouse and distribution facility. New Breed's director of business development, Joe Hauck, said the company will hire locally to fill probably fewer than 100 warehousing and distribution jobs.

A New Breed news release said that under the new contract, it "will receive, store, provide inventory control, kit, package, distribute, and transport 787 parts, tools, and supplies to designated locations within Boeing's facility."

Mark Blondin, president of Machinists union District 751, reacted angrily. "Those are Machinists union jobs," he said. "It's pretty damned disappointing."

Blondin heard the news Wednesday in a meeting with Boeing and wasn't consulted in advance.

Boeing "from the top down just doesn't get relationships with employees," Blondin said. "Rather than work with the union on how we can make the 787 program more efficient, they choose to go outside to an out-of-state provider."

Blondin said New Breed probably will qualify for the industry tax breaks the union lobbied for to keep the 787's final assembly in the state.

"We put a lot of effort into making sure they got their [tax] incentives," he said. "All they are really doing is shifting good-paying jobs from our factory to a non-union, low-benefit, low-wage outfit."

Hauck said New Breed has not set its wage rate here. "We pay a little above market rate for distribution people, fork-truck operators, pickers and so on," he said.

The going rate for general non-union warehouse work is well short of the Boeing rate for parts-delivery work.

According to the state Employment Security Department occupation database, the average wage in various categories covering this type of work varies from $14 to $18 an hour.

Within Boeing, more than 1,600 Machinists work in parts-distribution jobs on jet programs. Because of seniority, many of them earn a top rate of more than $26 an hour.

Hauck said New Breed has saved money for major companies by streamlining supply-chain logistics.

"Are we normally cheaper? In almost all cases, yes," he said. He cited Verizon Wireless — "We saved them a fortune" — and the United States Postal Service: "We saved them $500 million by their own accounting."

He said New Breed has provided similar supply-chain support since mid-2004 to Boeing's helicopter facility in Ridley Park, Pa., through a warehouse facility in Swedesboro, N.J.

Smaller distribution centers in Ontario and Kinston, N.C., provide spare parts support to Boeing's defense businesses.

Boeing spokeswoman Mary Hanson said contracting out the 787 parts-delivery work is consistent with the company's long-term strategy of moving away from low-level parts work and concentrating on systems integration.

She said there will be no layoffs as a direct result of this move, adding that the number of Boeing jobs continues to grow because of the surge in plane orders. Since the low point in June 2004, Boeing has hired almost 10,000 people in the state.

"The best way for us to provide great jobs for Boeing employees is to keep improving productivity and doing the things we need to do to stay competitive," Hanson said.

Hauck said New Breed will send a planning team to Everett soon and choose a site over the next few months.

Dominic Gates: 206-464-2963 or dgates@seattletimes.com