By Janet Williams in Seattle

The news that the Boeing Company was to move its corporate headquarters along with 400 jobs away from its home of Seattle came like a bolt from the blue for the city just over a year ago.

The firm eventually chose to go to the midwest city of Chicago.

Boeing said the move was strategic - the company was much more than just a maker of commercial aircraft, and its headquarters should reflect its new status as a multinational aerospace business.

Boeing Commercial Airplanes business with its 60,000 jobs remained in Seattle, but the realisation soon dawned that the city - home to Boeing since 1916 - could no longer take anything for granted.

Shock was soon replaced by concern - how many other jobs might soon follow?

Competition

Boeing's Commercial Airplanes Group said the region remained "its heartbeat", but Seattle economist Roberta Pauer said this is a very different Boeing for one essential reason - Airbus.

We have to do whatever it takes for us to be competitive

Alan Mulally, Boeing Commercial Airplanes

"There's no discounting the factor of competition and so now when a country considers buying planes they have a choice," she said.

"And when you have a choice as a customer you're in a position to bargain.

"They not only want the planes at a good price, but they want jobs and production facilities in their own country - that's just part of the bargaining," she added.

Roberta Pauer also stressed that Boeing, facing such fierce competition, must constantly strive to cut costs, and here Seattle faces another problem.

Alan Mulally, the head of Boeing Commercial Airplanes, said much needed to be done to improve the local business climate.

"The data says that in many areas we're not as competitive as other states, and... in a lot of areas we're not as competitive as other parts of the world in which we operate", he said.

"All those things have to do with the transportation and the way we finance education and what business pays for, the taxes for the revenue side, all the permitting process. This is such an opportunity for us to become a lot more customer focused."

Transport difficulties

If there is one thing on that list which makes Seattle uncompetitive it is traffic congestion.

To avoid massive delays, Boeing has resorted to transporting its equipment at four o'clock in the morning.

Seattle had been home to Boeing since 1916

But the governor of Washington State, Gary Locke, said he believed that Seattle did retain a competitive edge.

"We have tens of thousands of highly skilled workers making airplanes, it makes good business sense to utilise those individuals, that talent, the machinery and equipment that's already here to build the next generation of Boeing airplanes," he said.

"But that's why we need to solve the transportation problems, that's why we also need to make sure that we're supporting our research institutions like the University of Washington, so they can continue to produce top flight engineers.

"We have a big challenge ahead of us, but we're up to it."

Tough decisions

Local voters will decide in a referendum in November whether to increase taxes to improve the transport system.

Alan Mulally of Boeing Commercial Airplanes is encouraging his fellow citizens to back the move.

"We have to do whatever it takes for us to be competitive," he said.

"If not, every day we're making decisions about how we operate around the world and we'll keep moving to the place where we're embraced and we have environments in which we can be successful."

Boeing now operates in 26 US states and more than sixty countries.

Seattle has clearly been told that it has to compete with all of them.