Boeing Co. said Thursday it would move its headquarters from Chicago to the Washington, DC area, where company executives would be closer to top federal government officials.
The company said it will use its campus in Arlington, Va., as its new headquarters, and plans to develop a research and technology center in the area.
“The region makes strategic sense for our global headquarters given its proximity to our customers and stakeholders, and its access to world-class engineers and technical talent,” said Boeing CEO David Calhoun.
The move marks a victory for Republican Virginia Governor Glenn Youngkin, who campaigned last year on a promise to bring new jobs to the state.
Youngkin retired in 2020 as co-CEO of private equity giant Carlyle Group. He was personally involved in the move talks and had a prior business relationship with Calhoun, who was also an executive in the investment industry, according to a person familiar with the matter who was not authorized to discuss publicly. negotiations.
A spokeswoman for the state’s economic development agency did not immediately respond to questions about whether the state had offered the company tax or other incentives.
Boeing is closing in on its rivals — and the Pentagon
Boeing is a major defense contractor, and this move will bring leaders closer to Pentagon leaders. Rival defense contractors including General Dynamics, Lockheed Martin and Northrop Grumman are already based in the DC area.
Company executives are also said to be close to the Federal Aviation Administration, which certifies Boeing passenger and cargo planes.
Boeing’s relationship with the FAA has been strained since the fatal crashes of its best-selling plane, the 737 Max, in 2018 and 2019. The FAA took nearly two years – far longer than Boeing expected – to approve the changes of design and allow the aircraft to return to the air. Certification of new Boeing planes will also take longer.
The company suffered financial setbacks in building a tanker for the Air Force. And it has been hit by the pandemic, which has undermined travel and demand for new planes. Boeing lost $1.2 billion in the first quarter of this year.
Boeing has its roots in the Seattle area and has assembly plants in Washington State and South Carolina. The company moved its headquarters to Chicago in 2001 after an unusually public search that also considered Dallas and Denver.
Cai von Rumohr, aerospace analyst for Cowen, said there were benefits to Boeing moving its headquarters to the Washington, D.C., or Seattle area, where executives would once again be closer to Boeing’s important business operations. the company.
“Chicago doesn’t do anything for them,” von Rumohr said.
Boeing had 142,000 employees at the end of 2021, with 12% based outside the United States, according to a regulatory filing. The filing does not specify how many work in Chicago.
Richard Aboulafia, an analyst at consultancy AeroDynamic Advisory, said Boeing’s workforce in Chicago “is minimal,” making the move easier.
Rep. Peter DeFazio, chairman of the House Transportation Committee, which investigated Boeing and the FAA after the Max crashes, criticized Boeing’s decision to approach federal policymakers.
“Boeing should focus on making planes safe, not lobbying federal regulators and Congress,” he said.
Meanwhile, many elected officials in Virginia celebrated the news.
Democratic state Senate Majority Leader Dick Saslaw called it “hell of a trap.”
Democratic U.S. Senator Tim Kaine, a member of the Senate Armed Services Committee, said Boeing’s decision is a testament to Virginia’s skilled workforce and strong national security community.
US Senator Mark Warner, also a Democrat, said the deal has been in the works for some time.
“For more than a year I have been making the case to Boeing senior management that Virginia would be an ideal location for its headquarters, and late last year I was pleased to learn that my efforts have been successful,” he said in a statement.
The company statement thanked Youngkin and Warner.
Boeing will follow in the footsteps of Amazon, which decided to set up a second headquarters in Arlington. Last month, local officials approved Amazon’s plans to erect a 350ft fan-shaped building.