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Originally published Thursday, September 9, 2010 at 8:37 PM

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New Boeing plan: Expand work here

Boeing will expand its manufacturing research center in Seattle into a 900-employee operation meant to help it avoid the early production glitches that have plagued the first 787 Dreamliners.

Seattle Times aerospace reporter

Boeing will expand its manufacturing research center in Seattle into a 900-employee operation meant to help it avoid the early production glitches that have plagued the first 787 Dreamliners.

The move, along with a parallel expansion of composites work at its Auburn parts-fabrication plant, is intended to bolster Boeing's internal manufacturing capabilities.

After many years of outsourcing work from its Puget Sound-area factories to external suppliers, the expansion represents a significant Boeing investment in the region.

Initially, the new center will focus on building preliminary fuselage, wing and tail sections of the 787-9, the larger derivative of the Dreamliner. Later, it will fine-tune the manufacturing methods on future jets.

The move could also presage some "insourcing" of regular 787 production work. A local industry source said Boeing, which plans to ramp up 787 production to 10 planes per month by 2013, is considering building some Dreamliner wings and horizontal tails in Seattle.

Boeing said that hasn't been decided.

Even if the center eventually does manufacture 787 sections, Boeing's partners in Japan and Italy would continue to produce the majority of the 787's wings and horizontal tails. Seattle might build three of the 10 shipsets of wings per month under one proposal, the industry source said.

And the company still plans, as announced last year, to ensure it has suppliers outside this region for all 787 parts, so that it can continue production in case of a strike.

Boeing spokeswoman Mary Hanson said Thursday the company will by August 2012 fabricate and assemble vertical fins for the Dreamliner at its existing non-union plant in Salt Lake City, Utah. That part is currently the only major 787 section made in this area, in Frederickson, near Tacoma, which will continue to make the fins also.

Still, any mass production of Dreamliner wings and horizontal tails in Seattle would be a stunning turn for the troubled airplane program.

Company officials would not comment further on whether it will happen.

"No decisions have been made," said Boeing spokeswoman Cris McHugh. "However, we are always looking at how we structure our supply chain."

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What is already firmly decided is that effective Dec. 23 the commercial-airplane unit is taking over from the military side of the company most of the factory space inside its big research building on East Marginal Way, across from the Museum of Flight. Boeing will establish there what it's calling the Advanced Developmental Composites facility.

"We are investing in both our people and in our infrastructure and assets for the future," McHugh said. "This is really a reflection of Boeing's long-term commitment to the Puget Sound region."

The highly skilled production workers in the Seattle and Auburn facilities — part of the commercial unit's fabrication division — have fixed many of the problems arising on the Dreamliner, supplying parts that failed to show up or that needed replacing due to poor workmanship.

A Boeing internal memo to employees on the plans for the advanced-composites facility says it will focus in the future on "process stabilization and production hardening."

An employee at the current facility said supervisors have said this means Boeing intends not only to develop new advanced-composites manufacturing technologies at the new facility but also to fabricate major parts there in significant quantities until the production process is mature and stable.

"The plan is to grow that operation big-time," the Boeing employee said. "Their plan is to ramp up development and do initial production of the first 50 shipsets or so, and then hand off to somebody else."

Not an end

to outsourcing

Such a plan wouldn't mean outsourcing will end. After the hotshot engineers and Machinists at the Seattle advanced-composites center have ironed out all the problems with fabrication of plane sections, the work would then go elsewhere — perhaps to Everett or Renton, but perhaps also to Charleston, S.C., or to an outside partner.

But it would represent a major shift from how Boeing handled the initial development stages of the 787.

In 2004, Boeing made test fuselage barrels and wings for the Dreamliner at the Seattle facility, which has huge autoclaves — giant ovens for baking composites. Boeing brought in Italian and Japanese engineers and mechanics to learn the process, then immediately outsourced the production work to Japan and Italy.

That didn't work; 787 production has been plagued with supply-chain glitches that have contributed to delays of almost three years.

McHugh threw cold water on the notion that the Seattle facility might go beyond building test sections to doing significant production work on future airplanes, saying it's unclear whether that will happen. "We don't know for sure," she said.

The internal memo says Boeing is hiring now to provide planning and design support for the new advanced-composites center, with the factory production head-count ramp-up beginning next spring.

The employee said the expansion is expected to bring about 900 jobs to the site. Boeing's McHugh said most of those would be employees moving from other facilities within the company rather than new hires.

An engineer at the development site said Boeing is investing as much as $250 million in the project. McHugh declined to confirm that figure, saying the total investment is still undetermined.

Boeing officials said the company is also expanding its composite capabilities at its parts-fabrication plant in Auburn.

Workers there say the company is hiring toolmakers and tooling inspectors in preparation for bringing back from outside suppliers the work of making smaller 787 composite parts.

Defense work to move

Boeing's defense division, which until now occupied most of the proposed new composites-center buildings, will retain some space within the factory to complete the F-22 Raptor jet fighter program — which has congressional funding only through the spring of next year — and some other secret defense programs.

But as a result of the commercial-airplane division's expansion there, the defense unit is moving work out. It is reopening an old factory just north of the ADC building on East Marginal Way, called the Thompson site, where it plans to install the military systems hardware on its P-8 Poseidon anti-submarine jets.

The first production P-8, following three flight-test airplanes, is now under assembly in Renton.

When that plane is completed by the commercial-airplane division, it will fly to Boeing Field and roll across the road into the Thompson site for the military systems work.

Boeing spokesman Chick Ramey said the company plans a ribbon-cutting for the reopening of the site this fall.

The 19-acre site is where the original 737 jets were built between 1967 and 1970, and where in the late 1980s and early 1990s some 10,000 people worked on the B-2 stealth bomber program. Until 2007, the site was used to complete buildup of jet engines.

The site is part of a major industrial-pollution cleanup project along the banks of the Duwamish River, involving complex negotiations among Boeing, the city and Port of Seattle, King County, the state Department of Ecology and other affected parties including two Indian tribes that own land along the river.

Boeing spokesman Chris Villiers said the company "fully intends to continue operating the Thompson site while we proceed with cleanup of the waterway."

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

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