Spirit AeroSystems aims before the end of February to secure a revised supply agreement with Airbus, in an effort to help turn around loss-making production programmes.
The company, which lost $633 million in 2023, is seeking to patch up its Airbus programme work after last year doing the same by reaching a revised supply agreement with its other top customer, Boeing.
“We… are engaged in discussions with Airbus to address the long-term financials,” Spirit chief executive Patrick Shanahan said on 6 February. “The negotiations with Airbus continue and have been productive. We hope to conclude by February, but we need to ensure all items are addressed.”
Those items include “operational and financial solutions”, he says, adding, “Our focus has really been on price”.
He says prices paid to Spirit by Airbus must reflect Spirit’s costs and its actual productivity levels. “This remains an important near-term priority for me.”
Spirit’s issues with 737 production have been well publicised.
But in recent years the company has also taken massive losses against two major manufacturing programmes for Airbus – on the A220 and A350. Spirit makes A350 composite centre fuselage sections and the A220’s composite wings.
In the fourth quarter of 2023 alone, Spirit took forward losses of $57.7 million against its A220 work and $76 million against its A350 programme. Spirit’s leaders have attributed the losses to slower than expected production rates and shortages of skilled labour.
Spirit last year reached amended terms with Boeing related to production of 737 fuselages and 787 components – Spirit makes the widebody jet’s composite forward sections. That new deal allowed Spirit in the fourth quarter to reverse $206 million in previously booked forward losses on its 787 work.
