Advertisement
YOU ARE HERE: LAT HomeCollectionsAirplanes

Orders lift Boeing suppliers

Southern California firms are in a business boom not seen in nearly a decade as demand for the company's aircraft surges.

January 02, 2007|Peter Pae | Times Staff Writer

After nearly 40 years of assembling fuselage sections for the world's largest flying passenger airliner, Vought Aircraft Industries Inc.'s sprawling Hawthorne factory appeared in danger of joining a long list of Southern California aerospace plants that have been shuttered in recent years.

With orders for Boeing Co.'s 747 jumbo jet dwindling, the production rate steadily fell to one fuselage a month from a high of six a decade ago. Barely 500 people were working at the plant, a fixture of the local aerospace industry that once bustled with 2,500 employees.

But as 2006 came to a close, many Vought workers were happily talking about the prospects of being on the job a lot longer than anticipated, perhaps a decade or more.

Their renewed hope came in the form of the first order, from German airline Lufthansa, for a new passenger version of the 747 and Boeing's decision to commission the fuselage work from Vought's factories in Hawthorne and in Texas near its Dallas headquarters.

The deal, potentially worth $5 billion, is just the latest to come from a confluence of Boeing's rising fortunes, the stumbles of European archrival Airbus and a market for airliners that continues to rebound strongly from its steep sales decline after the 9/11 attacks.

"All of a sudden we got a light at the end of the tunnel," said Abraham Lupercio Jr., an aircraft mechanic in Hawthorne and a 19-year veteran who believes that he will be able to retire from the same plant where his father had worked for 27 years.

Lufthansa ordered 20 of the new, longer version of the Boeing jet, dubbed the 747-8. It will be able to carry about 500 passengers, or 100 more than the current-generation 747-400. The deal, announced last month, includes an option for the German carrier to buy an additional 20 planes down the line.

The 747-8 order continued the string of good news for Boeing and many of its subcontractors in Southern California. Bolstered by a surge in aircraft orders, suppliers are enjoying a boom in business not seen in nearly a decade. Through Dec. 21, Chicago-based Boeing had received orders for 904 aircraft, nearing 2005's record 1,028.

"We are on a hiring spree," said Venkat Raman, president of LeFiell Manufacturing Co. in Santa Fe Springs. The company, with about 95 employees, makes aluminum struts that hold the jet engines under the wings of Boeing's 747 and 777 airplanes.

LeFiell is one of more than 6,000 California companies that supply parts and services to Boeing, and the majority are based in Southern California.

In the next three or four years, Raman said, "we're looking at annual growth in excess of 20%." After shrinking its workforce by a third after aircraft orders bottomed out in the wake of the 2001 terrorist attacks, LeFiell began hiring again last year.

"It's so much better now," Raman said.

The aircraft industry added a net 63,000 manufacturing jobs last year, for a total of about 635,000, according to the Aerospace Industries Assn. in Arlington, Va.

"Very strong future orders and backlog point to a thriving civil market for years to come," said John Douglass, the trade group's chief executive.

Analysts expect more orders for the 747-8 as Airbus struggles to deliver its first A380 super-jumbo jets. The 555-passenger aircraft, beset by production problems and nearly two years behind schedule, is not expected to begin service until late 2007.

British Airways and Japanese carriers All Nippon Airways Co. and Japan Airlines Corp. could be the next customers for the 747-8, analysts say.

Boeing has overcome many false starts to reinvent the 747, a "cash cow" for the company for decades, said Richard Aboulafia, an aviation analyst at research firm Teal Group Corp. in Fairfax, Va.

With its signature hump housing a second passenger deck, the 747 has dominated the market for very large aircraft, and for many years most international, long-haul flights were flown by the 747. Boeing has made nearly 1,400 of the aircraft since it entered passenger service in 1970.

But with the entry of more efficient large aircraft such as Boeing's own 777 and Airbus' A340, airlines began to move away from the 747, viewing it as outdated.

Although cargo carriers continued to order the freighter version, Boeing had not received an order for a passenger variant of the 747 since 2002.

In 2005, Boeing proposed another update to the 747, but this time a longer version that would use more advanced materials and new fuel-efficient jet engines being developed for the company's upcoming 787 Dreamliner.

The initial orders came from cargo carriers, and Boeing struggled to find buyers for the passenger version.

But in recent months, Aboulafia said, the A380's production problems and reported progress in the development of new jet engines prompted airlines to take a closer look at the 747-8.

"The timing was optimum" for the 747-8, he said.

Workers in Hawthorne, where Vought's operations once encompassed an entire square mile, couldn't agree more. In recent years, the factory has been reduced by more than half, though it still takes up 1.5 million square feet, about the size of a large shopping mall.

Inside, sheets of aluminum hang from hoists like bedsheets on a laundry line as they move along an assembly line. The sheets are trimmed, dipped in chemical solutions and then bound together with fasteners and rivets to make ever-larger pieces. Eventually, they leave the factory in sections the size of billboards before being placed in specially designed railcars that take them to Boeing's plant in Everett, Wash., for final assembly.

"Things have been slow, so a lot of people were worried," said Howard Johnson Jr., an aircraft mechanic for 29 years who hopes to retire in about four years.

"But when I read about the Lufthansa order ... I just jumped up. Everybody is really happy."

*

peter.pae@latimes.com

Advertisement
Los Angeles Times Articles
|
|
|