Airbus Outlines Next Steps In Acquisition Of Spirit AeroSystems’ Work Packages

Airbus is on track to finalize its acquisition of a work package from Spirit AeroSystems before the end of 2024, marking a significant step in its strategy to enhance its supply chain and production capabilities. This acquisition is set to play a crucial role in Airbus’s ongoing efforts to ramp up aircraft production in response to soaring global demand.

Key developments in the acquisition

Airbus previously signed a detailed binding term sheet setting out its plans to take over the production of Airbus A350 fuselages in North Carolina and St Nazaire in France and Airbus A220 work in various locations, including Belfast, Northern Ireland. The manufacturer will control the part of the Belfast operation that makes wings and fuselage for its A220 jet.

Photo: JHVEPhoto | Shutterstock

The deal was announced in July as part of a wider restructuring of the Spirit business. Spirit AeroSystems’ broader global business is being divided between Boeing and Airbus, the two largest aircraft manufacturers worldwide. Airbus agreed to acquire two loss-making Spirit plants as Boeing moved to regain control over the rest of Spirit in an effort to address a growing industrial crisis following a recent production setback.

“We have to get to a formal signing of the contract,” Airbus chief financial officer Thomas Toepfer said during a third-quarter briefing, according to FlightGobal. “We’re expecting that to happen before the end of the year.”

According to the BBC, a regulatory review will be required after the deal is signed, and it will be completed in mid-2025.

Related

Boeing Strike Costs Spirit AeroSystems: Q3 Net Loss of $477 Million

Spirit AeroSystems said that it was on track to complete the merger with Boeing by mid-2025.

Uncertainty for some staff members in Northern Ireland

BBC reported that Spirit is Northern Ireland’s most significant manufacturing employer, with about 3,500 staff. Last month, trade unions raised concerns about the deal’s progress.

Airbus’ term sheet also included a $559 million compensation package from Spirit to cover the integration of loss-making projects. Toepfer stated that the payment should compensate for the negative impact before Airbus turns them neutral.

The completion of the deal will still leave uncertainty for employees in the Belfast operation’s non-Airbus segment, which primarily focuses on various Bombardier business jets.

Photo: Ian Dewar Photography | Shutterstock

Spirit, founded in 2005 as a Boeing subsidiary, is now undergoing considerable reorganization. Boeing started this separation in an attempt to bring Spirit’s activities back in-house to solve persistent production issues.

Concerns over supplies from Spirit Aero

Airbus is grappling with supply chain issues related to key structural parts of Spirit AeroSystems, impacting the production of both its largest and smallest jets. Industry sources told Reuters that these problems could lead to delays in the delivery of aircraft, including the long-haul A350, as the company faces long lead times for essential components.

Photo: Ian Dewar Photography | Shutterstock

To mitigate these challenges, Airbus is allocating additional resources to keep production on track, as it aims to increase total deliveries by 11% in the fourth quarter to meet its annual target of 770 jets.

Concerns primarily stem from the production of fuselage parts at Spirit’s Kinston plant in North Carolina. In response, Airbus has taken steps to expedite the supply of wings for the smaller A220 by airlifting parts from the Belfast facility.

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