Spirit Aero Receives Lifeline with $350 Million Advance from Boeing
Struggling supplier Spirit AeroSystems secured up to $350 million in advance payments from Boeing amidst cash-flow challenges. The deal follows a strike at Boeing that impacted Spirit's inventory and delivery capabilities. Spirit also explores funding with Airbus to stabilize production and meet obligations amidst financial hurdles.
Spirit AeroSystems, a key aerostructures supplier, announced it has secured up to $350 million in advance payments from its largest customer, Boeing. This development comes as the Wichita, Kansas-based company grapples with financial instability following four consecutive years of losses. The advance payments provide a much-needed lifeline for Spirit AeroSystems, which is also nearing an agreement for additional funding from Boeing's European competitor, Airbus, according to sources familiar with the negotiations.
The recent advance was confirmed just days after Spirit issued a 'going concern' alert, warning investors that the company might struggle to meet its financial commitments over the next 12 months. This funding arrangement comes amidst plans by Boeing to repurchase its one-time subsidiary, leading to a mandatory repayment of $350 million in 2026, though it is anticipated this could occur earlier with the tentative takeover projected in mid-2025.
Spirit AeroSystems' financial strains intensified when Boeing's MAX production slowed down following a mid-air incident on a new model. Delays in delivery were further exacerbated by a newly implemented process to ensure fuselage quality. The supplier is actively working to stabilize its operations, as part of efforts to support both Boeing's and Airbus's production goals, while addressing internal constraints.
(With inputs from agencies.)
ALSO READ
Strange Soccer Tales: Lightning Strikes and a Pig's Head
Tragedy Strikes Peruvian Soccer Match: Fatal Lightning Incident
Hezbollah Commander's Death in Airstrike Marks Escalation in Israel-Lebanon Tensions
Double Tragedy Strikes Chilutal: Murder Mysteries Unfold
Escalated Conflict: Lebanon in Turmoil Amid Israel Strikes