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Boeing Vice President Recaps Challenges for Aerospace Industry in California

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Boeing Vice President Recaps Challenges for Aerospace Industry in California CALIFORNIA CHAMBER OF COMMERCE AUGUST 26, 2011 ● PAGE 3 Boeing Vice President Recaps Challenges for Aerospace Industry in California Nan Bouchard, vice president of program management at The Boeing Company, testified before the Assembly Select Committee on Aerospace on August 16 about issues affecting the industry in California. Bouchard, also a member of the California Chamber of Commerce Board of Directors, was part of an aerospace industry panel that included representa- tives from Northrop Grumman, Aerojet and Lockheed Martin. Below are excerpts from Bouchard’s remarks to the committee. Boeing in California If we were to make a movie about the history of Boeing in California, the title could be, “Innovation.” The portfolio of history-making products designed and built here touches on every aspect of aero- space and aviation, spanning the first com- mercial telecommunications satellite, the Wood Photo by Megan venerable DC-10 commercial airplane and Nan Bouchard, vice president, program management and regional executive, Boeing Defense, Space the amazing Space Shuttle orbiter, which & Security, and a member of the CalChamber Board of Directors, testifies before the Assembly Select recently completed its final mission. Listed Committee on Aerospace on August 16. among the credits would be the names of our heritage companies, such as Hughes, McDonnell Douglas and Rockwell, built Space and Intelligence Systems, the com- delivered to date to our U.S. Air Force by creative pioneers who thrived and grew pany’s center for all intelligence, military customer, and our current focus is on in- in the hospitable climate. and commercial space systems. This busi- creasing international sales to keep the Today, Boeing continues to occupy a ness operates the world’s largest satellite production line going beyond 2014. diversified footprint spanning commercial design and manufacturing factory in El Other significant business areas in the aviation, military aircraft, network sys- Segundo, as well as Spectrolab, the Los Angeles region include our Boeing tems, satellite manufacturing, and new world’s largest manufacturer of solar cells Commercial Aviation Services team, also markets such as cybersecurity. The com- and a San Fernando Valley fixture for located in Long Beach, which provides pany’s direct and indirect economic foot- more than 50 years. engineering and related services to heri- print in California is substantial. Our Network and Tactical Systems tage commercial aircraft built at the for- Employees work at more than 50 loca- business unit is headquartered in mer Douglas plant that are still in service tions throughout the state, with the largest Huntington Beach and draws on the pow- as well as new designs like the 787. concentration in the Los Angeles area. er of integrated networks and tactical sys- In the high desert of Edwards Air Force Three sites—El Segundo, Huntington tems to connect and protect U.S. and al- Base, we have Boeing employees support- Beach and Long Beach—have more than lied soldiers, sailors and airmen. ing flight test operations for new designs 5,000 employees each. One of our most visible California- that are both manned and unmanned. In 2009, the most recent year for grown products is the C-17 Globemaster Near-Term Challenges which data is available, the annual state III, the last aircraft still being built in payroll was nearly $2.4 billion. California California and about to mark its 20th year So while we feel that the spirit of inno- also is home to more Boeing suppliers of operations. The C-17 is the world’s vation is alive and flourishing at Boeing, than any other state. In 2010, there were premier heavy airlift transport and has our ability to thrive in California is more 5,755 suppliers here, and the company proven itself as a versatile strategic and challenged ... Since 2000, the Boeing spent more than $6 billion on goods and theater airlifter in every recent worldwide workforce in California has shrunk from services with them. operation, from Operation Iraqi Freedom 36,700 to around 22,000 today. The core business areas for Boeing in to humanitarian relief missions. The C-17 Some of this is attributable to the California are primarily on the defense production facility is located in Long merging and integration of the heritage side. Headquartered in Seal Beach is our Beach. More than 200 C-17s have been See Boeing: Next Page AUGUST 26, 2011 ● PAGE 4 CALIFORNIA CHAMBER OF COMMERCE Boeing Vice President Recaps Challenges for Aerospace Industry From Previous Page bodiment of that innovation is our work- institutions to enhance undergraduate companies. But the headcount decline force. Boeing employs more than curricula, support continuing education of also is symptomatic of a more serious 159,000 people across the United States Boeing employees, recruit for internships problem, and that is the cost of doing and in 70 countries. More than 123,000 and employment, and collaborate on business in California. A recent example of our employees hold college degrees— research that benefits the long-term needs for Boeing was the move of our B-1B including nearly 32,000 advanced de- of our businesses. For 2011, the company program from Long Beach to Oklahoma. grees—in virtually every business and has invested more than $1 million in The B-1 bomber was designed and built technical field from approximately 2,700 partnership with California higher in California, so it was not an easy deci- colleges and universities worldwide. education institutions. We have an sion. But as Boeing reviewed its antici- Engineers make up a little more than 30 extensive Internship Program enterprise- pated operating costs for the next several percent of our workforce…. wide, with over 1,200 interns working at years, it became clear that major actions Boeing continues its strong efforts to Boeing this summer, of which more than were needed to remain affordable for our prepare the future workforce for tomor- 90 are in SoCal…. customer. The same cost barriers can row’s jobs and careers by advocating for come into play when the company looks improvements in education at all levels, Changes Ahead at new programs and services and where particularly in the science, technology, Looking to the future, everyone is fa- to place them. engineering and math (STEM) disci- miliar with the painful process this coun- The challenges of doing business in plines. We’ve forged strategic partner- try is undergoing to address its debt is- California are not unique to Boeing and ships with educational and other institu- sues and regain its economic footing. have been well catalogued. It is for these tions, and contribute volunteer and finan- At this time, it is too early to reasons that we applaud the recent rollout cial investment in education initiatives, determine what the specific implications of the economic development plan by the including internships and private-public of the recently passed debt ceiling administration of Governor Brown and partnerships. I’ll share some examples of legislation will be for Boeing and the Lieutenant Governor Newsom. This plan what we’re doing in California: products and services we provide for our proposes solutions to many of the issues ● Boeing has a long-standing partner- nation’s security…. businesses face in California, such as a ship with the Long Beach Unified School Certainly there is no question that the cumbersome and complex regulatory en- District, one of the largest urban districts aerospace industry is undergoing a trans- vironment that is greatly in need of in the country. Together we are working formation and the needs of our customers streamlining. to increase the number of math-certified are changing and evolving. Boeing is For example, the state imposes addi- teachers, enhance algebra readiness at the changing too. There is no such thing as tional and unique rules regarding the elementary grade level, identify a STEM tradition or the status quo in aerospace— workplace that necessitate specialized curriculum leader who will help link core we must always be thinking creatively to training classes for Boeing employees academics to real-world experiences and maintain our competitive edge and design located here. Support for future workforce needs, and bring engi- products that will delight and satisfy our manufacturers—the linchpin of the U.S. neers to the classroom to serve as STEM customer. Only last week, we announced economy—is another area that the lieu- mentors and guides. a strategic alliance with another company, tenant governor’s economic development ● Public-private partnerships are an- not to team up to build a new airplane or plan addresses. California is one of only a other area in which Boeing is trying to rocket, but to develop “smart grid” tech- few states that taxes manufacturers on make a difference. Boeing is partnered nologies to improve energy access and job-creating investments in plants and with the Los Angeles and Orange coun- security for the Department of Defense. equipment. ties school systems to promote arts edu- For Boeing in California, while it is In kicking off the economic develop- cation in the classroom. You may express true that our footprint is smaller, it is still ment plan, the lieutenant governor, speak- surprise at an engineering company like significant, and we are passionate about ing on behalf of the administration, said Boeing being so interested in promoting the products and services that we provide. that this is the beginning of a statewide the arts, but the fact is that the arts are We remain committed to being a good conversation. I would offer that today we about creativity and imagination, just like neighbor and reaching out to the commu- are continuing that conversation and fur- engineering. We are teamed with the Los nities where we live and work, to con- thering our support for making the plan a Angeles County Arts Commission on tinue to strive to make California as great reality.
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