Boeing acquires 468 acres in N. Charleston

By Liz Segrist
lsegrist@scbiznews.com
Published Dec. 13, 2013

The Boeing Co. announced today it acquired 468 acres in North Charleston — including the 267 acres it previously planned to close on today — to accommodate future growth.

The land acquisition announcement came the morning after Machinists union leaders rejected Boeing’s counteroffer that would have secured the 777X work for Washington state.

Palmetto Railways, a division of the S.C. Department of Commerce, is offering a long-term lease to Boeing for the additional 201 acres in North Charleston. The land was purchased with state bond funds allocated to Boeing. The price was not disclosed.

Boeing was planning to close on the original 267 acres today in a $13.8 million land deal. The Charleston County Aviation Authority previously sold the land to Palmetto Railways, which in turn leased the land to Boeing.

Boeing S.C. Vice President and General Manager Jack Jones
Boeing S.C. Vice President and General Manager Jack Jones said this expansion makes future growth in North Charleston possible. (Photo by Kim McManus)

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The company has an option to purchase all of the 468 acres at the end of the initial lease term at the end of 2027.

Boeing also announced today that it will begin construction in the second half of 2014 on a new paint facility at its main campus in North Charleston.

“This expansion makes future growth in North Charleston possible,” Boeing S.C. Vice President and General Manager Jack Jones said in a statement. “While we expect to begin the permitting process immediately for this property, we have no specific plans for the land other than where we will locate the new paint facility.”

The company expects to begin painting fully assembled 787 Dreamliners in South Carolina in mid-2016. The approximately 230,000 square-foot facility will be used to apply customer liveries to Boeing South Carolina-built 787s.

Currently, the 787s built in North Charleston are flown to Fort Worth, Texas, for final paint and then flown back to South Carolina for customer delivery.

“Painting our airplanes in South Carolina supports our lean manufacturing and production optimization initiatives,” Jones said. “We can make our delivery process even more efficient by painting airplanes here in South Carolina, creating more value and convenience for our customers.”

As part of the site expansion, Boeing will begin constructing a new 10,000-square-foot, fully equipped fire station at its main campus in January; it is expected to be operational by late 2014.

The company will add a second autoclave in 2016 to support aftbody composite fabrication for previously announced 787 program rate increases.

“We’ve been busy here in South Carolina this year,” Jones said. “Our Boeing South Carolina teammates have not only been ramping to rate in component and airplane production, but they’re doing it in the middle of construction zones.”

The expanded land deal comes amid weeks of speculation regarding where the 777X will be built after the Machinists union’s initial rejection on Nov. 13 of a labor agreement proposal with Boeing that would have secured 777X work for Washington state.

After the vote, Boeing opened up the 777X site selection process. It has received proposals from 22 states, and many states submitted multiple sites for the work.

Boeing offered the Machinists union a counterproposal Wednesday as its “best and final offer” to the union. Leaders of the Machinists union rejected the counteroffer Thursday night.

Rich Michalski, the Machinists union’s lead negotiator involved in the talks, said the union members must decide the final outcome in a vote, according to a Seattle Times report. It’s unclear whether they will get that opportunity.

“It’s a pretty fluid situation right now,” Frank Larkin, the union’s communications director, said in an emailed statement today. 

Long Beach, Calif., Huntsville, Ala., St. Louis and North Charleston have been thought to be top contenders along with Everett, Wash., for the 777X work. Boeing said 54 sites are now being evaluated for the 777X.

“Our commitment to South Carolina is visibly demonstrated every day as our growth and expansion continues. I don’t expect that ending anytime soon,” Jones said.

Reach Liz Segrist at 843-849-3119 or @lizsegrist on Twitter.

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