Why Boeing's New Jet Is Too Big for Just One City

A current Boeing 777 jet, courtesy of Mark Harkin under Creative Commons License. Emirates Airline is a major 777 customer, and may order up to $30 billion worth of 777X jets at the Dubai Air Show later this month.

The Washington State legislature is closing in on a special incentive package to entice The Boeing Company (NYSE: BA  ) to place final assembly of its new 777X aircraft in Everett, Wash., at its Puget Sound factory located about 25 miles north of Seattle. The fuel-efficient, next-generation aircraft will compete with the long-haul offerings of EADS  (NASDAQOTH: EADSY  ) subsidiary Airbus, and will be delivered to its first customers in 2020.  But the plane won't be designed entirely in Everett.

Recently, Boeing announced that it would spread a significant portion of the 777X's design among five different American engineering sites, with some contribution from its Russian design center in Moscow.

What's the rationale for splitting up the design of the 777X to centers as far away as the East Coast and Russia? In the accompanying video, Motley Fool contributor Asit Sharma offers three major reasons that are likely driving this decision by Boeing -- one that was not taken lightly, since the 777X will be one of the most important profit drivers for the aerospace giant over the next two to three decades.

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9/26/2016 4:01 PM
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Airbus CAPS Rating: ****