“We believe this deal is in the best interest of the flying public, our airline customers, the employees of Spirit and Boeing, our shareholders and the country more broadly,” Boeing President and CEO Dave Calhoun said in a news release.
The acquisition will include substantially all Boeing-related commercial operations, as well as additional commercial, defense and aftermarket operations. As part of the transaction, Boeing will work with Spirit to ensure the continuity of operations supporting Spirit’s customers and programs it acquires, including working with the U.S. Defense Department and Spirit defense customers regarding defense and security missions.
The acquisition is seen as an effort by Boeing to regain control over a key supplier that has been plagued for years by quality control issues. The company was owned by Boeing until 2005, when it was sold as part of an effort to reduce costs. Even so, the two remained intertwined, with Spirit manufacturing about 70 percent of each 737 Max before it was sent to Boeing’s Renton, Wash., factory for final assembly.
Even before the Alaska Airlines blowout, a series of issues at Spirit — including a labor dispute last year in which manufacturing employees walked off the job for a week before a new contract was reached — had delayed deliveries of 737 Max aircraft. The troubles prompted a shareholder lawsuit alleging Spirit was slow to disclose the issues.
In a briefing last week, Elizabeth Lund, senior vice president overseeing quality control and quality assurance efforts at Boeing, said that the fuselage of the 737 Max jet that would ultimately be involved in the Jan. 5 door panel blowout was damaged when it arrived at the Renton factory. Work to address that issue, led to the removal of a door panel, which was reinstalled but without four bolts used to secure it. Lund said one of the steps that Boeing has taken to prevent a repeat of such an incident is that Boeing will no longer accept fuselages that do not meet its quality standards.
Spirit also has worked to improve its operations. Last October, the company brought in a former Boeing executive Pat Shanahan to be its new chief executive.
In the wake of the Jan. 5 blowout, both Boeing and the Federal Aviation Administration have stepped up oversight of Spirit. At a hearing before the Senate Commerce, Science and Transportation Committee, FAA Administrator Michael Whitaker said in addition to deploying additional inspectors at Boeing facilities, it has also increased its presence at key suppliers including Spirit.