Boeing CEO Dennis Muilenburg says reauthorization of the Export-Import Bank isn’t about helping his company sell airplanes, but about giving American businesses a level playing field with the rest of the world.
“This is about long-term, global competitiveness,” Muilenburg said last week during his first earnings call as chief executive officer. “And that’s why we’re so forceful on this topic that it’s important Ex-Im be reauthorized.”
The Ex-Im Bank provides loans and loan guarantees to foreign companies that want to buy American products, including commercial airplanes. Boeing, which makes its 787 Dreamliner jets in North Charleston and Everett, Wash., is the 81-year-old lender’s top customer, though thousands of businesses use the bank every year.
Ex-Im’s charter expired June 30 for the first time in its history because of congressional inaction. Its prospects for revival are uncertain because conservative lawmakers denounce it as corporate welfare. The bank’s supporters point out it turns a profit and returns money to the U.S. Treasury.
President Barack Obama last week urged Congress to reauthorize the bank, but it remains in political limbo.
“We know it has the attention of both the House and the Senate right now,” Muilenburg said. “We remain optimistic that we’ll ultimately see reauthorization. But we also recognize that there’s a political risk to that. So we’re being mindful of that and staying properly engaged in the process.”
During the 2014 fiscal year, the bank made or guaranteed 22 loans for Boeing’s commercial airline sales to 18 foreign countries totaling nearly $7.4 billion. That figure represents more than one-third of the $20.5 billion in financing the bank approved last fiscal year.
Muilenburg said the bank’s dormancy hasn’t yet hurt Boeing, even though 15 percent of the company’s customers have used Ex-Im for financing.
“This is not something that creates near-term financial risk for Boeing,” he said. “There are multiple commercial credit sources available today that the market is sound there.”
About 60 other countries have banks providing similar financing for exports — including France, where Boeing competitor Airbus is based — and Muilenburg said that puts U.S. exports at risk.
Sage Automotive Interiors in Greenville is one of those at-risk companies. CEO Dierk Pieper told The New York Times that his company’s $300 million in sales and $42 million payroll would not be possible without the bank, which provided the company a working capital guarantee of $9 million four years ago.
Pieper, who is also vice chairman of the S.C. Manufacturers Alliance, said the bank has been a godsend to small business owners. Losing Ex-Im funding could cost Sage several hundred jobs, he told the newspaper.
The bank said in its annual report that small business deals accounted for nearly 90 percent of the 3,700 transactions it did in fiscal 2014.
“It’s about allowing U.S. industry to be globally competitive,” Muilenburg said. “It’s about American manufacturing jobs. It’s the right thing for the country to do. And we’re going to continue to advocate on behalf of U.S. manufacturing jobs.”
It’s not the most high-tech thing Boeing has ever built, but for employees at the North Charleston plant, it’s certainly a welcome addition.
The company today opened a new off-site parking lot near its campus along International Drive for the thousands of workers who build the 787 Dreamliner. The 1,200-vehicle lot, with an additional 26 spaces for disabled motorists, is accessible from the intersection of International Drive and South Aviation Avenue. A private entrance also is available off Dorchester Road. Shuttle buses will take employees from the lot to the production facility.
The parking lot isn’t the only thing going up at the Dreamliner plant.
Boeing also is building a paint hangar that will be able to accommodate two 787-10s — Boeing’s largest planned Dreamliner, at 224 feet long and a wingspan of nearly 200 feet — at the same time. That facility should be ready sometime next year.