Boeing wants to buy back the company that builds the body of its troubled Max planes
CNN
Boeing said it is in talks to buy Spirit AeroSystems, a major supplier that was part of Boeing until a 2005 sale, and one that was also involved in the Alaska Airlines doorplug incident.
Boeing said it is in talks to buy Spirit AeroSystems, a major supplier that was part of Boeing until a 2005 sale, and one that was also involved in the Alaska Airlines doorplug incident. Negotiations were first reported earlier Friday by the Wall Street Journal and Seattle Times. Spirit shares soared 15% in trading Friday on the reports. But shares had been down 10% from the time of the Alaska Air incident through Thursday’s close, and down 70% since the second fatal crash of a Boeing 737 Max in March of 2019, which led to a 20-month grounding of the jet. Boeing sold Spirit in 2005, receiving $900 million in cash for the sale. Spirit AeroSystems, which is based in Wichita, Kansas, makes major parts of several Boeing models, including the fuselages for the 737 Max. The parts are then shipped to Boeing’s factory in Washington state via rail. “We believe that the reintegration of Boeing and Spirit AeroSystems’ manufacturing operations would further strengthen aviation safety, improve quality and serve the interests of our customers, employees, and shareholders,” Boeing said in a statement late Friday. ”Although there can be no assurance that we will be able to reach an agreement, we are committed to finding ways to continue to improve the safety and quality of the airplanes on which millions of people depend each and every day.” About $3.9 billion of Spirit AeroSystems’ revenue last year came from Boeing, making up about 64% of its overall revenue. Boeing rival Airbus is its second largest customer. It is unlikely that Boeing would be able hold onto that part of the business were it to reacquire Spirit. Spirit’s market cap at the close of trading Friday, after shares had been lifted by the reports of a possible deal, stood at $3.7 billion, or just slightly less than what Boeing paid Spirit last year as its major supplier. But after five years of net losses totaling $31.5 billion, Boeing ended 2023 with only $12.7 on its balance sheet, down from $14.6 billion the year before.
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