Boeing’s Delco helicopter factory faces labor competition and design delays, Pentagon watchdog says

Boeing has been building and upgrading Chinook CH-47 heavy-lift military helicopters, in Ridley Park between I-95 and the Delaware River, since 1971, and V-22 Osprey tilt-rotor aircraft there since 1989.

The plant has survived where many of its neighbors shut over the years. Steel, locomotive, shipbuilding, and chemical plants once lined the river. With three million square feet of factory space, Boeing’s Delaware County footprint is bigger than Comcast’s two Philadelphia headquarters towers and almost as large as Amazon’s biggest-anywhere warehouse near Wilmington. The site is home to half of Boeing’s vertical lift division, including the Osprey and Chinook assembly lines, and the unit’s engineering and design center and wind tunnel.

But its war products depend on public funds, which shift from year to year. That leaves Boeing, the largest industrial employer in the Philadelphia region with about 4,400 engineering, assembly, and management staff, dependent on generals and politicians for contracts, including for innovative new aircraft that could protect and add jobs here.

Now, added to the usual drama of bids and budgets, a recent government watchdog report has laid out challenges for the Defense Department’s weapons programs contracted out to Boeing and other manufacturers. This year’s review, sent to Congress by the U.S. Government Accountability Office (GAO), comes as the military has shifted strategic priorities to meet threats from China and Russia.

Across weapons programs, design issues and delays are a problem, according to the GAO. “And they slow the department’s current emphasis on delivering capabilities to the warfighter faster,” the report found. Defense officials agreed with the report’s two main recommendations on updating and strengthening policies.

Here are some of the challenges facing Boeing, according to the GAO, and responses from the company:

“Boeing is experiencing aircraft mechanic workforce limitations due to a competitive labor market” at its Texas facilities where it’s building Air Force One planes, the GAO found, with fewer than expected passing security clearances.

Overall, almost half of 59 U.S defense contractor programs surveyed in the report said it was “difficult to find staff” for software jobs. The military itself will have to do more recruiting and training, the GAO concludes. It also notes hiring issues have delayed General Dynamics’ nuclear submarines and Boeing’s own Air Force One replacement jets.

“The labor market is challenging,” acknowledged Mark Cherry, vice president and general manager of Boeing’s vertical lift division, in an interview this month at the Ridley Park plant. During the pandemic, Boeing hired laid-off machinists based at nearby Philadelphia International Airport, but now finds it’s competing with the resurgent airlines.

Cherry, who moved here last year from Boeing’s fighter jet works near San Diego, wants to raise the plant’s profile in the region. “We get a lot of talent from Penn State, Drexel, and Temple,” he noted. “Our technicians come from the communities around here,” along I-95 in Delaware County and northern Delaware, and in South Jersey. He estimates the plant’s suppliers employ even more than the factory.

By stressing opportunities to work on new technologies, “very competitive” pay and benefits, scheduling flexibility, and the sense of a national mission — more than one in six Boeing employees are former military — the company hopes to create “a sense of belonging,” said Akeem Iman-Jones, who heads human resources for Boeing’s helicopter plants.

But there are limits to flexibility. “You can’t build aircraft remotely,” Cherry said. Even for designers, “if you have an expert on rotors, there’s nothing like turning eyes right on that rotor. We have to put the aircraft together” in person.

After the Army, in 2018, announced decades of upgrades to the Chinooks, seemingly guaranteeing lifetime employment to Ridley Park workers, the Pentagon the next year cut the budget for upgrades, redirecting funds to long-range artillery and electronic and space weapons that generals deemed more useful in future wars, as strategists pivoted toward containing China and Russia.

The local congressional delegation has fought to maintain some annual Chinook funding each year since, but plant staff note production has dropped from four Chinooks a month to around two.

The GAO reports problems with the designs for the planned upgrades. New rotors, which the Army program had said were “fully mature,” turned out to suffer “excessive vibration that led to safety concerns.” The Army decided to stop development on those rotor blades and use an older design.

Additionally, a new fuel system “failed in testing,” the report said. (A Boeing spokesman later said the system now works and is going into production.)

The rotor that GAO said raised safety worries was designed for Afghanistan and other hot, sandy environments. But with the Army pullout from Afghanistan and its “pivot” to conflicts in Europe or East Asia, Cherry said the new rotor was deemed “not as critical.” A new order for 60 Chinooks for the German army, the biggest ever from a foreign user, will use the original rotors.

And despite the issues noted by GAO, the Army “has moved into production” with other upgrades by Boeing, Cherry said.

In 2018 the Air Force said it wanted Boeing to begin producing a military version of the AW-139 civilian helicopter made by Italy-based Leonardo to defend nuclear missile sites and to ferry senior government officials around the Washington, D.C., area, replacing 63 older helicopters.

Leonardo, which operates the former AgustaWestland, has a U.S. factory at Northeast Philadelphia Airport — so a government purchase could boost work at both local plants.

But according to the GAO, “Boeing underestimated the scale of design work,” which has delayed a final production decision since last September.

Cherry said Boeing has had to negotiate additional approvals of military upgrades of the civilian helicopter with the Federal Aviation Administration.

For example, “a commercial AW-139 does not have identification friend or foe artificial intelligence systems,” Cherry noted. “It’s part of the challenges. We are making sure we have a completely safe product.”

The tilt-rotor craft, used by the Marines and our Japanese allies to take off from a short runway and land like a helicopter, was recently in the news, evacuating U.S. diplomats ahead of Russian bombings in Ukraine — and in a fatal accident in California, now under investigation.

The GAO report listed no particular issues with Osprey.

Cherry said the company is looking into an electric version, an example of how, “if you want to work in the most technically advanced aircraft that exist, come here.”

Boeing and rival Lockheed Martin’s Sikorsky division, which closed its Coatesville civilian helicopter plant last year, were tapped back in 2014 to develop the Defiant X assault helicopter. It will fly twice as fast, Boeing says, as the Black Hawks it will replace.

The design includes two counter-rotating rotors, instead of the familiar large-and-small pair. “The program leadership is headquartered” at Ridley Park, said Cherry. But a final decision on where to build Defiant has not yet been announced. Cherry expects to hear more this fall.

Bringing Defiant production to Philadelphia would keep the two big assembly lines busy. It could even require additional manufacturing space, which Boeing says is available along Pennsylvania Route 291 by its engineering center.

“We inherited a great set of products, and we want Philadelphians to work on new ones, like the Defiant helicopters, for a long time to come,” said Cherry. “We want this site to grow.”