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Updated March 2nd, 2024 at 15:13 IST

Boeing in Talks to Acquire Spirit AeroSystems Amid Quality Concerns

Boeing, accounting for nearly two-thirds of Spirit's sales, sees the reacquisition of manufacturing operations as a strategic move.

Reported by: Sagar Kar
Boeing
Boeing | Image:AP
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Boeing has confirmed that it's exploring the possibility of acquiring Spirit AeroSystems, a major supplier of jet fuselages, as the aerospace giant faces mounting pressure to address quality issues in its operations. The potential acquisition comes in the wake of a recent incident involving an emergency exit door detaching from an Alaska Airlines flight, leading to the temporary grounding of all 737 MAX 9 planes in U.S. territory earlier this year. 

According to reports from The Wall Street Journal, Boeing and Spirit AeroSystems are engaged in preliminary discussions about a potential deal. Spirit, which manufactures 737 fuselages and other airframe components, was established in 2005 when Boeing divested some of its factories.

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Boeing accounts for almost two-thirds of Spirit's sales 

Boeing, accounting for nearly two-thirds of Spirit's sales, sees the reacquisition of manufacturing operations as a strategic move to enhance quality standards within its supply chain.

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The announcement comes amid heightened scrutiny from the Federal Aviation Administration (FAA), which has given Boeing 90 days to develop a plan addressing "systemic quality-control issues." The FAA is currently conducting an audit of Boeing's production and manufacturing quality systems.

After news of potential acquisition broke, shares of Spirit surged 

Following the news of the potential acquisition, shares of Spirit AeroSystems surged by over 15% on Friday, closing at $32.98 and pushing the company's market capitalization to $3.83 billion. Meanwhile, Boeing's shares experienced a slight decline, closing down 1.8% at $200.

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Published March 2nd, 2024 at 15:13 IST

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