Renton has been bracing for the impacts of a potential shutdown at the local Boeing factory, where workers build the 737 Max, which was grounded worldwide earlier this year after two deadly crashes. Now Boeing has announced suspension of Renton production in January — no layoffs or furloughs are expected at this time.
According to a statement released Monday, Dec. 16, Boeing is suspending the production following the Federal Aviation Administration moving certification of the Max into 2020, possibly in March or April.
“As a result of…ongoing evaluation, we have decided to prioritize the delivery of stored aircraft and temporarily suspend production on the 737 program beginning next month,” Boeing stated in a press release.
The company also states this is the “least disruptive to maintaining long term production system and supply chain health.” The company has about 400 planes in storage as it continued to build new Max airplanes at the Renton factory.
“During this time, it is our plan that affected employees will continue 737-related work, or be temporarily assigned to other teams in Puget Sound,” the Boeing press release states. “We will keep our customers, employees and supply chain top of mind as we continue to assess appropriate actions.”
Councilmember Randy Corman was a Boeing employee for over 30 years, as an airplane engineer, manager and safety and certification manager. He said while he hoped it wouldn’t come to this, he is glad Boeing kept production going as long as it did. He remembers times when he went on strike as an employee, shutting down production for up to 40 days, but this is unlike any previous labor interruption.
“Everybody is used to the standard, out for a while (during a strike), come back and get going again,” Corman said. “But I think this is more uncharted territory.”
Corman said Renton employees temporarily assisting in nearby factories could help with production at the other plants, and that it was a very sensible approach. Other plants can put the time with additional employees to good use.
The factory shutdown would impact its 12,000 workers. Renton is also home to several part suppliers for the Max airplanes— the impacts for those companies is yet to be determined. Corman predicts some of those other local supply chains may need to furlough or reassign employees during the suspension. Businesses around the plant will also feel the absence of Boeing over the next few months.
Mayor Denis Law released a statement after the Wall Street Journal and The Seattle Times reported that a shutdown was being considered by company leaders in Chicago. Law stated the city is aware on of the options the company was considering was a temporary shutdown of the plant.
“We are hopeful that any suspension of production would be for a limited time to minimize any negative impact to local businesses,” Law stated. “However any suspension in production will impact local employees, which is very unfortunate, especially during the holiday season.”
Last week, Law hinted at the possibility while speaking with city staff and community members at his retirement open house, joking that a impending shutdown of the Boeing plant in Renton never happened during his term.
In an email, Renton Deputy Public Affairs Administrator Preeti Shridhar stated that the city doesn’t expect financial impacts from a production stop for 2019, and it’s not predicting impacts in the future being “hopeful it is temporary.” The city was waiting for details of the shutdown before making any fiscal predictions.
The Boeing company is about 15 percent of Renton’s workforce. Corman said he anticipates that it will not create any budget crisis at city hall. Renton residents who work at Boeing might do some “belt tightening,” which would hit sales tax revenues.
The company told shareholders this summer it may shut down the line if it couldn’t return to service soon, as previously reported by Renton Reporter.
This story will be updated as more information becomes available.