Boeing CEO Mulally: Washington State must do more for businesses

Boeing Commercial Airplanes Chief Executive Alan Mulally warned Washington political leaders yesterday that recent steps to improve the state’s business climate have not gone far enough, and Boeing will build its next new airplane elsewhere if more is not done.

By David Bowermaster
Seattle Times aerospace reporter

"As tough as the conversation is, our wonderful state needs to get out of denial and start really thinking about what it takes to grow and attract business and keep business," Mulally said.

"We’re dedicated to doing that," he continued. "At the same time, we’re going to keep looking at our alternatives to see what we have to do as a business to be competitive, because it is really, really tough."

Boeing will decide in late 2003 or early 2004 whether to produce a new 200- to 250-seat airplane known as the 7E7. The company has said it will conduct a global review of potential sites for the plane’s final assembly.

Later this month, Boeing is expected to issue a list of criteria sites must meet to be considered.

Mulally’s comments conveyed obvious exasperation with the Washington Legislature, particularly on transportation issues.

Even though lawmakers last month approved a 5-cent-per-gallon gasoline tax to help fund $4.2 billion in transportation improvements, Mulally complained anew about the body’s failure to pass a more-ambitious package in 2002.

Mulally also cited the state’s tax structure, unemployment-insurance scheme and funding for higher education as sore points for Boeing and other Washington business leaders.

Mulally delivered his remarks during a question-and-answer session after a presentation to the Ragen MacKenzie Investment Conference at Seattle’s Bell Harbor Conference Center.

The issue of where the 7E7 will be built was just one of several topics Mulally touched upon yesterday, from the outbreak of severe acute respiratory syndrome, or SARS, in Asia to the commitment of board member Harry Stonecipher to Boeing’s airplane business — "Harry is a really good friend of mine."

But because Boeing has said it will consider a broad range of U.S. and international locations for the 7E7’s final assembly, every comment on the subject is scrutinized in the Puget Sound area.

Mulally went to great lengths to say Boeing, and he personally, have worked to remedy what the company sees lacking in Washington, rather than simply complain.

"We’re not just going to all of a sudden surprise everyone and not be here because we can’t be competitive," Mulally said. "But we’re going to commit our resources and our talent to go work this with the governor and the state."

Mulally, for instance, accepted Gov. Gary Locke’s invitation to head the state Competitiveness Council two years ago.

That work, he said, opened his eyes "very wide" to the challenges of improving the business climate.

"In most categories, when you manage a business, the state of Washington is not the most competitive or the friendliest place to do business," he said. "We’ve got a lot of issues."

David Bowermaster: 206-464-2724 or [email protected]

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