A United States Air Force C-17 Globemaster III airlift aircraft. Photo courtesy of Boeing.
UPDATE Monday, June 6, 1:01pm | The fate of Boeing’s C-17 production line is less gloomy following an announcement Monday that India has approved a $4.1 billion deal to purchase 10 of the cargo jets in what media outlets are reporting is the largest defense deal the country has ever struck with the United States.
The deal reportedly includes an option allowing the Indian government to purchase an additional six airlifters, an Indian government spokesman told the Wall Street Journal.
Stan Clemchuk, president of United Automobile, Aerospace and Agricultural Implement Workers of America, Local 148, told the Associated Press that the Long Beach plant was “abuzz” Monday morning with the news.
“We knew the order was in the works, The extra planes will get us through 2012. We know numerous, numerous countries are interested in planes in 2013, but 2012 was the gray year,” he told the AP. “This will allow us to make it through to 2013. It’s huge.
“It’s a great day for Long Beach,” Clemchuck said.
The order will preserve thousands of jobs at Boeing’s Long Beach plant, where the Globemaster III tactical transport airlift aircraft is assembled, according to the White House.
Prior to the deal’s final approval announced this morning, the C-17 production line stood to be shuttered due to sluggish sales from both the United States Air Force and American foreign allies. The company had been set to deliver the last of its currently ordered planes in December 2012, Boeing spokesman Jerry Drelling said.
Boeing is the largest employer in the city of Long Beach, with some 3,700 salaried and hourly workers employed at the C-17 assembly plant. The jobs of roughly 25,000 workers in 44 states are dependent on the aircraft’s production, Drelling said.
He added that the manufacture of the C-17 impacts the economy to the tune of $5.8 billion annually.
As part of the deal, Boeing is required to invest 30 percent of the $4.1 billion contract into defense-related industries in India.
Though the agreement has been approved, both parties have yet to sign the contract. The deal has been in the works since President Barack Obama’s visit to India last year, when New Delhi officials first agreed to purchase the planes.
Delivery of the planes is expected to begin two years after the contract is inked.
April 28, 12:01pm | Long Beach-based Boeing’s production of C-17 aircraft will come to an end in 2013 if the United States Air Force and the nation’s international allies do not issue additional orders for the large airlift aircraft, according to information provided by Boeing’s C-17 program manager.
The USAF is Boeing’s best customer for the company’s C-17 Globemaster III tactical transport, having ordered 223 of the aircraft, according to the USAF ‘s program of record, said Boeing’s Bob Ciesla, the C-17 program manager.
The USAF’s C-17 order has been on schedule and budget for more than 200 deliveries over the last decade. As of this month, 210 of the aircraft had been delivered, Ciesla said. The most recently completed aircraft, which operates out of Joint Base Lewis-McChord in Washington, was delivered on April 14, according to the C-17 program website.
Still, due to the military’s cap on procurement because of budget restraints, Boeing has, beginning this fiscal year, slowed its production of the aircraft from 15 to 10 per year in an effort to extend the line while maintaining the C-17’s status as an affordable option both domestically and abroad, Ciesla said.
“Boeing and its key suppliers continue to obligate company resources to preserve the option for cost-effective C-17 production in the future for both the U.S. Air Force and our international allies,” he said.
International allies have purchased 26 C-17s, and while future international orders appear to be promising, timing is unpredictable and quantities insufficient to sustain production for more than a few years, Ciesla said.
According to RP Defense, a French news blog, Boeing recently inked a contract with the Indian Air Force for 10 C-17s with six possible options, and it is the largest export order to date for the aircraft. Additional countries that may strike deals with Boeing to purchase C-17s include Malaysia, Oman, Singapore, South Africa and Saudi Arabia, according to RP Defense.
And on April 18, Boeing announced that the Commonwealth of Australia had signed an agreement with the U.S. government to acquire a fifth C-17, according to Boeing’s website.
The USAF plans to retire up to 32 C5A aircraft and replace them with “existing” C-17s. The USAF may ultimately replace additional C5As that are retired with new C-17s. This would result in new orders, meaning the production line would be extended.
Still, Ciesla warned that “without additional USAF and/or international orders, C-17 production will cease in 2013, surrendering world leadership in large airlift aircraft production to foreign competitors.”
The defense and aerospace company announced its scale-back of C-17 production in February 2010. The slowdown resulted in the elimination of roughly 1,100 jobs. Some 900 of the jobs lost were local, Long Beach positions, as the reduction eliminated the entire second shift at the Long Beach C-17 final assembly facility.