In line with its aggressive drive to squeeze costs out of its supply chain, Boeing is switching subcontractors at a facility that paints its jets in Portland.
Current subcontractor Commercial Aircraft Painting Services issued layoff notices Dec. 1 to all its 186 workers.
French company Finaero, which is headquartered in Toulouse and paints jets for Airbus, will take over the facility at the end of January and will likely rehire a significant portion of that highly specialized workforce — though possibly with lower wages or benefits.
Boeing owns the facility, which consists of two hangars at Portland International Airport. Because its Everett paint shop cannot handle all the widebody jets built there, Boeing uses the Portland hangars as an overflow paint operation.
The facility is CAPS’s sole location and the company is therefore going out of business, said its owner and president, Paul Lubomirski.
Lubomirski said CAPS paints anywhere from three to seven widebody airplanes per month, depending on the overflow needs from Everett. He said that when CAPS moves out at the end of January, there’ll be a transition period until Finaero re-starts the operation.
“This operation is really important to Boeing,” Lubomirski said. “It’s in everyone’s interest to get the hangars back in production as soon as possible.”
CAPS has had the Boeing contract for the past five years. Workers there voted in July to join the International Association of Machinists union, Local Lodge No. 63, which also represents more than 1,200 Boeing employees in Portland.
Boeing spokesman Doug Alder said the unionization was not a factor in CAPS’ losing the contract.
When the CAPS contract expired this year, the company failed to agree on pricing terms for renewal and Boeing put the work out to bid, he said.
Alder said the jetmaker “had a good working relationship with CAPS,” but “we were unable to reach agreement on a long-term contract.”
“To meet our customer commitments and affordability targets, it became necessary to compete the contract through an open bidding process,” Alder said.
He added that the talks with CAPS over a new contract ended in June, “several weeks before we were even informed that a union vote was going to be called.”
CAPS is the latest casualty in Boeing’s intense push to lower costs, which has seen it switch from several longtime suppliers to others that can produce the savings the jetmaker is looking for.
Finaero “underbid us, so obviously their cost structure is going to be different than ours,” said CAPS president Lubomirski.
Boeing’s Alder said Finaero is “working with CAPS management to retain as many of their employees as possible.”
“Hiring fairs are scheduled to provide those employees with opportunities for continued employment,” he added.
Britt Cornman, acting directing business representative for IAM Local 63, said the CAPS workforce has very specialized skills and that if Finaero hires back more than half of the 147 workers in the bargaining unit, it will be obligated to negotiate a contract with the IAM.
He said the union has had no contact yet with Finaero management.
