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Boeing is moving its headquarters from Chicago to Arlington, Virginia, according to two people familiar with the deal, a sign that the aerospace giant is leaning on its military wing and better positioned to navigate the political quagmire.
The move, first reported by The Wall Street Journal, may be officially announced next week. This also comes when Boeing is struggling to get rid of the financial burden of the 737 Max, the stifling effect of the pandemic on travel and the consequences of severing ties with Russia. The company reported a loss of $ 1.2 billion in the first quarter.
The move was confirmed by two people familiar with the deal, who said on condition of anonymity, as the company planned to wait until next week to make the announcement. Boeing did not immediately respond to a request for confirmation from The Washington Post.
Governor Glen Yongkin’s (R) administration has been working with Boeing for the past few months to lure the company into the state, according to two people who said the manager, a former Carlyle Group CEO, has a personal relationship with the president and CEO. of Boeing David L. Calhoun.
The state has not offered Boeing any “significant” financial incentive for the company, the two said.
Arlington County spokeswoman Jessica Baxter said in a statement that “for competitive reasons and to protect confidential company information, we cannot comment on current or potential prospects for economic development.” Arlington County Board Chair Katie Crystal (D) also declined to comment.
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The move comes after Boeing has faced increased control from the Federal Aviation Administration in recent years, a change that came after lawmakers pointed to close ties between regulators and the company following the 737 Max crashes in 2018 and 2019. The relocation of executives to Washington it can help smooth that connection, but it can also irritate engineering and production personnel at the forefront who have previously expressed concerns about their rejection of safety issues by company executives and senior FAA officials.
Boeing currently operates a large office in the Crystal City neighborhood of Arlington, less than a mile from the Pentagon and at the end of an area that local authorities have called the “National Landing.” Amazon is building a second plant – also a few blocks away – that aims to consolidate development in the area.
The relocation of Boeing to Arlington confirms the predictions of many National Landing accelerators, who said Amazon’s arrival in the area would boost economic growth in a neighborhood that has long been considered underutilized and underdeveloped. Following a 2005 federal commission recommendation to relocate defense contractors, Crystal City lost about 17,000 military and defense workers, occupying about 4 million square feet of office space.
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As part of efforts to create a high-tech corridor in National Landing, Virginia Tech is planning a new campus for graduate engineers in the Potomac Yard area of Alexandria. Last year, Boeing donated $ 50 million to the school for financial aid and other diversity initiatives, and university leaders also said they plan to work closely with the aerospace company on student projects and career initiatives.
Told about the company’s plans to relocate, Ed Pearson, a former senior manager at the Renton, Washington, 737 factory, said his “stomach had dropped.” He said it would be important for leaders to keep in touch with their manufacturing operations in the Seattle and South Carolina areas.
“My immediate reaction was that Chicago was a long way off, and to think it was moving away was staggering,” said Pearson, who introduced himself to Congress as a whistleblower.
Much of the FAA’s attention is focused on the 787 Dreamliner, which is manufactured in South Carolina. Aircraft quality problems have accumulated and Boeing has stopped delivering aircraft to customers.
The company said when it posted quarterly profits last week that it had submitted FAA documents that would clear the way for supplies to start again, but it remains unclear when regulators can give their approval.
Boeing moved its global headquarters to Chicago in 2001, but its commercial aircraft division remained based in Renton, Washington, outside Seattle, where the company was founded in 1916.
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