Spirit Aero's Deliveries to Boeing Surge in 4Q Despite Challenges

Spirit Aero

Spirit AeroSystems, a leading aerostructure manufacturer, reported a significant increase in deliveries to Boeing in the fourth quarter, likely rising by 20% compared to the previous year. This surge came as Spirit took advantage of Boeing’s work stoppage to improve its operational processes and deliver more shipsets efficiently.

Increased Deliveries Amid Boeing's Work Stoppage

Spirit AeroSystems handed over 160 shipsets to Boeing between October and December, up from 133 during the same period in 2023, according to preliminary earnings results. Deliveries of Boeing's flagship 737 MAX saw a notable 28% increase, reaching 160 units in this timeframe. Boeing CEO Kelly Ortberg acknowledged that Spirit's performance improvements during a seven-week work stoppage had a positive impact on the quality of the 737 fuselages. Ortberg emphasized that Spirit's enhanced performance has removed the company as a constraint on Boeing's goal of ramping up its 737 build rates to 38 per month in 2024.

Impact of Boeing's Production Adjustments

Despite these gains in deliveries, Boeing’s total 737 deliveries for the year dropped by 25%, falling to 376 units. This decline was attributed to Boeing's decision to reduce aircraft output and slow fuselage shipments earlier in the year, as Spirit's Wichita, Kansas facility adjusted its production capacity.

Spirit also saw increased deliveries to Airbus in the fourth quarter, with shipsets rising by 18% to 231 units. The increase was primarily driven by a 21% boost in A320 deliveries, which grew to 181 units. Total shipments in 2024 rose by 14% to 825 units, with A320 deliveries increasing by 13% to 648 units.

Boeing’s Plans to Reacquire Spirit AeroSystems

Spirit's future with Boeing is also evolving, as Boeing continues with plans to reacquire its former subsidiary. Spirit’s shareholders approved the integration deal on January 31, with the transaction expected to close in mid-2025, pending regulatory approvals and divestitures to Airbus. Despite these developments, Spirit expects to report a loss of $413 million for the quarter, compared to a profit of $291 million in the prior-year period. The company has indicated it will file a "going concern" disclosure due to its cash flow and liquidity challenges.