24/07/2024 8:46 AM


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Spirit AeroSystems halts production for Boeing jets indefinitely

FILE PHOTO: Airplane fuselages bound for Boeing’s 737 Max production facility sit in storage at their top supplier, Spirit AeroSystems Holdings Inc, in Wichita, Kansas, U.S. December 17, 2019. REUTERS/Nick Oxford

(Reuters) – Spirit AeroSystems Holdings Inc (SPR.N), Boeing’s top supplier, said on Wednesday it had stopped production for the planemaker for an indefinite period and would furlough workers supporting Boeing programs in Kansas and Oklahoma.

Spirit’s announcement comes days after Boeing suspended production of its 787 Dreamliner airplane, citing the impact of the coronavirus pandemic.

Boeing has already suspended production of its smaller 737 MAX airplanes, which await government approval to fly again following two deadly crashes.

Spirit previously announced plans to suspend production for Boeing for two weeks ending April 8.

The company said its factories in the United States will continue producing parts for Boeing rival Airbus SE (AIR.PA), its second biggest customer, which accounted for 16{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} of its sales last year, while also carrying on work for Spirit’s defense contracts.

In January, Spirit said it would lay off 2,800 workers at its marquee facility in Wichita, as the 737 MAX grounding prolonged.

Spirit said on Wednesday it will reduce pay for all U.S.-based executives by 20{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} until further notice, and that Boeing production-related furloughs in Kansas and Oklahoma were for 21 calendar days.

The company had 18,200 employees as of 2019 and 15,900 of them in the United States.

Spirit’s shares were up about 6{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} at $19.50 in premarket trading. The company’s stock has fallen about 75{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} this year.

Reporting by Ankit Ajmera in Bengaluru; Editing by Saumyadeb Chakrabarty and Shounak Dasgupta

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