Boeing’s 777X Could Soon Find a New Home State


The question of where Boeing’s (NYSE:BA) 777X production will land continues to be a hot topic in the weeks since the fallout between Boeing and the Washington state International Association of Machinists over perceived slights in a new contract. With the proposal deadline set to arrive on Tuesday and a final decision expected to be announced in early 2014, states are scrambling to offer incentive packages that will lure the planemaker for the production of the next generation 777 aircraft.

“We have gotten a tremendous response, and it’s obviously created a lot of interest and a lot of excitement,” says Boeing spokesman Doug Alder. But much of that interest has to do with Boeing’s considerable bargaining position in the current economy, where top manufacturing jobs are increasingly hard to come by. Still, that hasn’t stopped states from rolling out the red carpet as the production of Boeing’s 777X is being viewed as a huge coup for whatever state manages to sway the planemaker.

According to Reuters, Missouri, Alabama, California, South Carolina, and Georgia are currently in the hunt to lure the production of Boeing’s 777X with extensive incentive packages, and there are sure to be other states to offer similar deals when Tuesday’s deadline arrives. In Missouri, lawmakers are meeting in a private session to discuss tax cuts and other benefits for Boeing. Other states are likely doing the same and will continue discussions up until Tuesday’s deadline.

In Missouri, lawmakers have crafted an incentives packages that could be worth up to $1.7 billion over 23 years, provided Boeing creates 8,000 jobs in the region. Incentives include tax breaks for factory construction, job training, and debt financing. Reuters points out that while this number is much lower than the $8.7 in tax incentives offered by Washington state, other costs such as energy, wages, taxes, and shipping can vary widely from state to state, making a comparison strictly between tax breaks impractical when considering the competitiveness of states.