Boeing is to move its corporate HQ out of Seattle after 85 years in a move that symbolises its shift away from commercial aircraft manufacturing into new ventures including financing, space and communications, service provision, air traffic management (ATM) and in-flight entertainment and communications.

"This is about nimbleness and flexibility," explains Boeing chairman and chief executive Phil Condit. "Simply put, we intend to run Boeing as a business that has the flexibility to move capital and talent to the opportunities that maximise shareholder value."

Boeing has also restructured its senior management, promoting presidents Alan Mulally, Jerry Daniels and Jim Albaugh to CEO level, with responsibility, respectively, for running its three main units, Commercial Airplanes, Military Aircraft and Missile Systems, and Space and Communications.

Commercial aircraft manufacturing will remain based in the Seattle area and continues to be Boeing's single largest earner - generating more than $31 billion of its total sales of $51.3 billion last year. The future of the Renton narrowbody plant is under review, however, though Condit says Boeing has "not made any decision yet" about moving out.


Boeing's corporate HQ will move from Seattle to a location more central to its two other main bases in Los Angeles and St Louis. It has shortlisted Chicago, Dallas-Fort Worth and Denver, and aims to make a decision by early summer. The 1,000-strong headquarters staff will be halved during the move.

"For strategic reasons, it's important we move the corporate headquarters," says Condit. While greater authority is being given to the three new CEOs, the headquarters will continue to distribute capital, while Phantom Works will facilitate the transfer of new data and technology between units.

Condit says the move is a continuation of the transformation and diversification of Boeing that can be traced from the acquisition of Rockwell Aerospace and McDonnell Douglas through to last year's purchases of flight information specialist Jeppesen Sanderson and Hughes Electronics's satellite manufacturing business.

That transformation last year saw the military unit generate sales of $12.2 billion and the space division another $8 billion. Boeing is also keen to follow the General Electric model in building up its financial services business into one that Condit says could be "on a par with these units". Boeing is also seeking a home for its new ATM unit, currently Seattle-based, with Washington DC a possible site.

Source: Flight International