Boeing is Buying Supplier Spirit AeroSystems
ARLINGTON, Va. (NEWSnet/AP) — Boeing plans to acquire supplier Spirit AeroSystems, a step it says will improve plane quality and safety amid increasing scrutiny by Congress, airlines and the Department of Justice.
Boeing previously owned Spirit, and the purchase would reverse a longtime Boeing strategy of outsourcing key work on its passenger planes. That approach has been criticized as problems at Spirit disrupted production and delivery of popular Boeing jetliners including 737s and 787s.
The deal is for $4.7 billion.
“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 statement late Sunday.
Concerns about safety emerged after the Jan. 5 blowout of a panel on an Alaska Airlines 737 Max 9 at 16,000 feet over Oregon. The Federal Aviation Administration soon after announced increased oversight of Boeing and Spirit, which supplied the fuselage for the plane.
No one was seriously injured in the Alaska Airlines door incident, which terrified passengers, but Boeing is under pressure from the U.S. Justice Department to plead guilty to criminal fraud in connection with two deadly plane crashes involving its 737 Max jetliners more than five years ago.
Boeing has until the end of the week to accept or reject the offer, which includes the giant aerospace company agreeing to an independent monitor who would oversee its compliance with anti-fraud laws, according to several people who heard federal prosecutors detail a proposed offer Sunday.
Boeing spun off Spirit, which is based in Wichita, Kansas, and not related to Spirit Airlines, in 2005. In recent years, quality problems have mounted, including fuselage panels that didn’t fit together precisely enough and holes that were improperly drilled.
Spirit removed its CEO in October and replaced him with Patrick Shanahan, a former Boeing executive who served as acting defense secretary in the Trump administration.
Spirit said in May that it was laying off about 450 workers at its Wichita plant because of a production slowdown since the January incident. Its total workforce was just over 13,000 people.
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