Business

July 3, 2012

Airbus to build first U.S. assembly plant in Alabama

by Melissa Nelson-Gabriel
Associated Press

In the battle to dominate the global aviation industry, European aerospace giant Airbus announced its first assembly plant in the United States July 2, a symbolic and significant step in the competition with archrival Boeing.

The French-based company said the Mobile, Ala., plant is expected to cost $600 million to build and will employ 1,000 people when it reaches full production, likely to be four planes a month by 2017.

“We are going to create great jobs and generate growth right here,” Airbus CEO Fabrice Bregier said at the convention center in Mobile, where many of the 2,000 people in attendance waved American flags as music played in the background.

“We know in aerospace, when we create one job, there are about four related jobs so we could bring as many as 5,000,” Bregier said at a later news conference. “The management to the blue collars will be 100 percent American.”

Boeing already has a big presence in Alabama, employing 2,700 people in defense and rocket operations.

Airbus planned to build refueling tankers for the U.S. Air Force in Alabama, but its parent company, the European Aeronautic Defense and Space Co., lost the contract to Boeing in 2011.

While Airbus had parts plants in the U.S. before, a full-fledged plane-making factory is a more significant presence and could help it boost its share of U.S. commercial and defense contracts.

The Airbus plant advances the company’s strategy of expanding production outside its home base. The company, jointly run by French and German management and with plants in several European countries, wants to expand in China and India as well as the United States.

The Alabama is also a way for Airbus to save face after losing the Pentagon tanker contract.

The companies have had a long-running international trade dispute. Each also has been critical of subsidies received by the other.

EADS shares have being climbing on European markets since news of the Alabama deal surfaced last week.

Airbus plans to manufacture the A320, a widely used plane flown by Delta Air Lines, US Airways and others. The 150-seat plane is generally used on short- and medium-haul flights, and Airbus makes more of them than any of its other planes. They retail for $88 million, although discounts are common for big customers.

The Mobile operation will join Airbus assembly plants in in Toulouse, France; Hamburg, Germany; and Tianjin, China.

The southern region of the United States is traditionally unfriendly to unions, which will likely mean lower labor costs compared with the company’s other factories in France and Germany.

“Clearly we selected a competitive environment and we are businessmen so we don’t go to the worst place,” Bregier said.

Airbus unions have expressed concern about European jobs lost to the United States, a particularly thorny issue in France as new President Francois Hollande tries to re-invigorate manufacturing at home.

Other big manufacturers have found homes in the South. Boeing has a plant in North Charleston, S.C., and Alabama is home to plants owned by Mercedes-Benz, Honda, Hyundai and Toyota.

Mercedes’ plant was so successful that it was soon followed by Honda and Hyundai assembly plants and a Toyota engine plant that reshaped the manufacturing economy in a state still reeling from the loss of textile and apparel jobs.

Mobile is already home to several aerospace companies, including ST Aerospace Mobile, Goodrich Aerospace and Star Aviation, and much of the business is based at the 1,650-acre Brookley Aeroplex, where the new plant will be based. The aeroplex was an Air Force base until its closure in 1969.

While Airbus looks to boost production of its A320, Boeing is ramping up production of its 737, which competes directly with the A320. Both companies are putting new, more fuel-efficient engines on the planes, hoping to extend their appeal as airlines try to cut fuel costs. Airbus made its new-engine decision earlier than Boeing and got a big jump on orders.

The U.S. is a growing market for Airbus. American Airlines ordered 260 A320s last year, and US Airways is buying them as well. However, Delta went with Boeing 737s in a 100-jet order in August.

Airbus already has a facility in Mobile that employs about 230 people designing and installing interior items such as seats and cabin equipment for its big planes.

The Airbus announcement comes as Alabama struggles to recover from the recession. Unemployment has dropped from 10.0 percent in July 2011 to 7.4 percent in May, but part of that drop came from people leaving the work force rather than finding jobs.




All of this week's top headlines to your email every Friday.


 
 

 

Headlines December 19, 2014

News: SpaceX’s attempt to land rocket on floating barge postponed - It’s set to be one of the most groundbreaking moments in humanity’s six decades of space exploration. Obama signs $1.1 trillion spending bill into law - President Obama signed the $1.1 trillion federal spending measure into law Dec. 16, officially ending any threat of a government...
 
 

News Briefs December 19, 2014

Trial set for ex-Navy engineer in military secrets case A former Navy civilian engineer is scheduled to stand trial next summer on charges of trying to steal aircraft carrier schematics. Media outlets report that 35-year-old Mostafa Awwad of Yorktown, Va., pleaded not guilty Dec. 17 to two counts of attempted exportation of defense articles and...
 
 
Army photograph by C. Todd Lopez

Army to launch cruise missile-detecting aerostat at Aberdeen Proving Ground

Army photograph by C. Todd Lopez The Army plans to launch an aerostat, part of the “Joint Land Attack Cruise Missile Defense Elevated Netted Sensor,” in late December 2014. The JLENS aerostat will be tethered to the...
 

 
Air Force photograph by SrA. Jordan Castelan

AF delivers Iraqi F-16s for training in US

Air Force photograph by SrA. Jordan Castelan Iraqi air force captain Hama conducts preflight inspections while inside a new to service Iraqi F-16 Fighting Falcon Dec. 17, 2014, located at the nearby Tucson International Airport...
 
 
Air Force photograph by SSgt. Derek VanHorn

Short-notice: A new way to exercise

Air Force photograph by SSgt. Derek VanHorn Airmen from Kadena Air Base, Japan, prepare for an aeromedical evacuation exercise on a KC-135 Stratotanker Dec. 5, 2014, at Misawa Air Base, Japan. The operation was executed in supp...
 
 
Lockheed Martin photograph by Andy Wolfe

Japan, Australia to provide F-35 maintenance sites in Pacific region

Lockheed Martin photograph by Andy Wolfe An F-35C Lightning II joint strike fighter carrier variant prepares to launch from the aircraft carrier USS Nimitz in the Pacific Ocean, Nov. 6, 2014. Japan and Australia will be sharing...
 




0 Comments


Be the first to comment!


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>