Last month, Boeing’s chief financial officer said by mid-year the airframer might finalise a deal under which it would acquire its struggling supplier Spirit AeroSystems.
That mid-year deadline is now little more than a week away, and recent reports say the deal might be coming together fast.
The Air Current and Reuters both reported on 20 June that Boeing might next week disclose reaching an agreement to purchase Spirit, which supplies aerostructures to both the US giant and its European rival Airbus.
But given that Spirit provides parts to both airframers, the deal also requires Airbus’s involvement: Bloomberg reported on 21 June that Toulouse is closing in on an agreement to acquire several Spirit units supplying its programmes.
In other words, the deal seems to be coming together, a sentiment that pushed Spirit’s stock price up about 8% on 21 June.
Boeing declines to comment and neither Spirit nor Airbus responded to requests for comment.
Spirit has struggled operationally and financially in recent years, suffering from quality problems amid labour shortages and losing hundreds of millions of dollars on its composite structures work.
Boeing had owned the Spirit operation until spinning it off in 2005. In March, the US airframer revealed it was considering reabsorbing Spirit as a means of fixing the supplier’s longstanding troubles and shoring up a critical part of its supply chain.
“I still believe we can get something signed in the second quarter, but it is a large and complex [deal], and we are not going to rush,” Boeing CFO Brian West said on 23 May.
Boeing’s acquisition plan came as it was reeling from a January incident involving the in-flight failure of an Alaska Airlines 737 Max 9’s door-plug. US investigators have said Boeing workers at the company’s Renton 737 assembly site, prior to delivering the jet, had removed the plug so Spirit personnel could fix a rivet problem. Boeing’s employees then replaced the plug but apparently never bolted it in place, leading to the plug’s loss.
An acquisition of Spirit by Boeing is no simple matter. Analysts agree Spirit would need to divest its Airbus work as a prerequisite, but how that would shake out has been an open question.
Airbus may be leaning toward taking on the work itself. Bloomberg’s report said the European airframer is moving closer to reaching an agreement with Spirit to acquire operations in Kinston, North Carolina, Saint-Nazaire in France, Belfast in Northern Ireland and Prestwick in Scotland. The report says such a deal remains uncertain and could change or collapse entirely.
The Kinston facility produces A350 centre-fuselage sections, which Spirit then ships to Saint-Nazaire for assembly. The company produces A220 wings in Belfast and wing and other components for Airbus jets in Prestwick.
Analysts say a Boeing acquisition of Spirit also might necessitate changes or possible divestitures by Spirit of other businesses, noting the company contributes to some classified defence programmes. That work might create competitive conflicts if taken on by Boeing.
