Boeing is taking over a factory originally built by KraftMaid Cabinetry in the Salt Lake suburb of West Jordan.
Boeing has 575 employees in Utah and said it will add 100, paying factory wages that state officials said will average $65,000 a year.
Hiring will begin immediately for engineers and project managers, and Boeing will add production workers after converting the KraftMaid factory into a production facility for carbon-fiber aircraft parts, said Craig Trewet, director of Boeing Salt Lake.
Chicago-based Boeing assembles the 787 in Seattle and has had operations in Utah for 25 years. It makes flight deck parts, has a paint shop and assembles the 787's vertical tail fin at other locations near Salt Lake's airport. In West Jordan, Boeing will make horizontal stabilizers for the aircraft's tail.
"The site we've chosen is an ideal location to add composite manufacturing capability focused on Boeing's key business strategies," said Ross Bogue, vice president and general manager of Boeing Fabrication. "This new facility will provide a real competitive advantage in our supply chain."
Boeing said it will take two years to redesign the 850,000-square-foot factory.
Gov. Gary Herbert joined company officials Friday for the announcement and has authorized tax incentives and other benefits for Boeing's expansion.
The company will be entitled to a 20-percent rebate on payroll, income and sales taxes at the new location for a maximum incentive of $1.3 million over 10 years, said Michael Sullivan, a spokesman for the Governor's Office of Economic Development.
In addition, Utah offered Boeing up to $225,000 in matching funds to train new manufacturing workers.
That makes it more likely that Boeing will hire Utah residents rather than bring in workers from other locations, Sullivan said.