Chicago Chosen as Boeing’s New Home
Boeing Co. is leaving the Space Needle for the Sears Tower as the world’s largest aerospace company announced Thursday that it picked Chicago for its new world headquarters.
The Windy City beat out Dallas and Denver for the coveted right to be called Boeing’s new home, ending one of the nation’s most intense lobbying wars as each city tried to outdo the other by rolling out celebrities, lavish dinners and multimillion-dollar tax incentives.
“This is a great day for the state of Illinois and the city of Chicago,” Gov. George Ryan said as he welcomed Boeing Chairman Phil Condit at Chicago’s Midway Airport.
The decision, announced with much fanfare, dramatically changes Boeing’s 85-year relationship with Seattle, where the company had grown from a wooden airplane maker to the world’s largest manufacturer of airplanes, satellites and rockets.
The move could provide a morale boost for Southern California, where Boeing is the largest private employer with 38,000 employees. Instead of fighting for attention at headquarters dominated by Seattle-based commercial plane executives, the California-based operations are likely to gain some ground in Chicago, analysts said.
“What’s good for Boeing is good for Southern California, and this is a good deal,” said Jack Kyser, chief economist with the Los Angeles Economic Development Corp. “You have to say that Chicago is going to be a good location because it’s not going to be so parochial.”
In March, Boeing executives stunned Seattle--and corporate America--by announcing it wanted to move its headquarters and was going to look at the three cities for its new home. The decision was kept secret until Thursday morning, when Condit departed Seattle and then disclosed a flight plan that would take him to Midway.
Boeing’s flight from Seattle was particularly surprising because the company was synonymous with the city, where many of the residents liked to say they bled “Boeing Blue.”
But Boeing officials said the relocation was necessary to reflect the company’s diversification. Although it remains the world’s largest commercial aircraft maker with 60% of the market, it has become a major builder of military aircraft and has increasingly focused on communication satellites and space-based weapons. Much of Boeing’s space and communications business is in Southern California.
“We’re here not because we wanted to leave Seattle but because we wanted to build a bigger, more capable Boeing,” Condit said as he announced the decision.
In addition to giving each of its three core businesses more independence, Boeing officials said it wanted to move east to be closer to New York’s Wall Street, government leaders in Washington and its major commercial airline customers.
One of its largest customers is United Airlines, which is headquartered in Chicago.
Coincidentally, United has its roots in Seattle, where Boeing’s founder William Boeing created the airline to fly his planes. Boeing eventually divested the airline, but the close relationship remained. Moreover, the first passenger to fly on a Boeing airplane was the legendary Chicago reporter Jane Eads. Her account of the Chicago-to-San Francisco trip on a mail carrier airplane helped open air travel to commercial passengers.
Chicago has been abuzz with speculation since word leaked earlier in the week that a Boeing announcement was imminent, although the relocation itself is mostly symbolic, analysts said.
Fewer than 500 Boeing executives will move out of Seattle, leaving behind about 80,000 engineers and mechanics who design and assemble the airplanes in Washington.
But the intangible benefits are enormous, Chicago officials contend, including the marketing cachet of saying it is home to the world’s largest aerospace concern that could draw other companies to the city.
“This sends a message to other companies that is as important as the jobs,” said Rita Athas, vice president of the Northern Illinois Planning Commission. “Boeing was looking for what other companies are looking for, and Boeing decided those things are here. That’s a powerful message.”
All three cities rolled out the red carpet for Boeing.
In Chicago, Boeing executives dining at the posh Art Institute of Chicago were entertained by a children’s choir singing “My Kind of Town” as well as a string quartet from the Chicago Symphony.
Dallas officials offered to slash taxes by 75% for 20 years, as they served steak and eggs and had a mariachi band provide entertainment. Denver had former Bronco quarterback John Elway meet and dine with the Boeing executives.
Despite the all-out wooing, there didn’t seem to be much ill-feeling among the losing cities. Texas Gov. Rick Perry congratulated Chicago, saying “all Texans knew from the outset that the competition with Chicago and Denver would be fierce.”
In Chicago, the welcoming ceremony for Boeing on Thursday resembled a reception typically held for a foreign head of state.
City officials rolled out a red carpet onto the tarmac as local television stations interrupted programming to broadcast the event live.
Providing blow-by-blow accounts, television reporters detailed how Ryan was running late, forcing the Boeing Bizjet, a modified 737, to circle over the airport before landing.
After declaring he was “absolutely delighted to be here,” Condit was ferried to a helicopter that then toured Chicago before landing near the new headquarters overlooking the Chicago River.
The company expects to begin moving employees to the high-rise Sept. 4.
Boeing shares closed up 95 cents at $65.95 on the New York Stock Exchange.
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Times researcher John Beckham contributed to this report.
