| Spirit AeroSystems Holdings, Inc. | |
| Former Name: | Mid-Western Aircraft Systems |
| Type: | Public |
| Key People: | Pat Shanahan (President & CEO) |
| Industry: | Aerospace |
| Revenue Year: | 2023 |
| Income Year: | 2023 |
| Net Income Year: | 2023 |
| Assets Year: | 2023 |
| Equity Year: | 2023 |
| Num Employees: | 18,235 |
| Num Employees Year: | 2022 |
| Hq Location: | Wichita, Kansas, U.S. |
| Footnotes: | Financials . References:[1] |
Spirit AeroSystems Holdings, Inc. is an American manufacturer of aerostructures for commercial airplanes, headquartered in Wichita, Kansas. The company produces fuselage sections for Boeing's 737 and 787 aircraft, as well as the flight deck sections for a majority of Boeing airliners. Spirit also supplies Airbus with fuselage sections and front wing spars for the A350 and wings for the A220. Spirit's primary competitors in the aerostructures market include Collins Aerospace, Kawasaki Heavy Industries, Leonardo, and Triumph Group.
Spirit AeroSystems was established in 2005 when Boeing spun-off its Wichita division to an investment firm. Boeing entered into an agreement to re-acquire Spirit in July 2024 for $4.7 billion. Airbus will assume control of Spirit's European operations, which have faced financial challenges.
Spirit was originally formed as Mid-Western Aircraft Systems when Boeing sold its Wichita factory along with facilities in Tulsa and McAlester, Oklahoma to the investment firm Onex Corporation in June 2005 for US$900 million in cash and the assumption of $300 million in debt, a total of $1.2 billion in enterprise value.[2] [3] The company was renamed Spirit AeroSystems a few months later. The sale was part of a larger effort of Boeing to divest itself of assets,[4] in pursuit of increased return on net assets, a metric focused on by CEO Harry Stonecipher, who had come from McDonnell Douglas.[5]
The Wichita plant was originally founded as Stearman Aircraft in 1927 before being acquired by the United Aircraft and Transport Corporation (UATC) in 1929. Following the breakup of UATC in 1934, the plant was retained by Boeing and became the Wichita division of the Boeing Airplane Company in 1941. The Wichita division was responsible for the construction of several models of strategic bomber aircraft including the B-29 Superfortress, B-47 Stratojet, and B-52 Stratofortress.[6] The Wichita factory primarily builds fuselage sections, including 70% of the structure for the Boeing 737.
The Tulsa plant was originally opened as a Douglas Aircraft Company facility to build bombers and other aircraft during World War II. When the war ended, Douglas mothballed the plant until 1953 when it reopened to assemble the B-47 StratoJet and the B-66 Destroyer. North American Aviation moved into about a third of the facility in 1962. The Tulsa plant builds wings and components for Boeing aircraft.[7]
The McAlester factory opened in 1964 as North American Aviation facility, supported the company's Apollo capsule and B-1B Bomber projects, primarily focusing on machining operations in support of the Tulsa factory.[8]
Over time North American and Douglas would both become part of Boeing, which took control of both Oklahoma factories in 1996. Operationally, they were wrapped into the Wichita division. However, Boeing long expressed interest in selling the Oklahoma factories. When they were spun-off to Spirit, again talks were held about selling the Oklahoma plants. However, nothing came of these talks. In 2020, Spirit announced it would close its McAlester plant, moving work to Tulsa and Wichita.
Under Onex ownership, Spirit's mandate was to build a portfolio of business with customers other than Boeing. In January 31, 2006, BAE Systems announced it had agreed to sell its aerostructures business, based at Glasgow Prestwick Airport and Samlesbury Aerodrome, to Spirit.[9] The unit is a major supplier to Airbus (80%), Boeing (15%) and Raytheon (5%). The transaction was completed on April 1, 2006. Spirit paid for the business.[10] In 2009, Spirit opened a plant in Subang, Malaysia out of a need for expansion and to take pressure off the Prestwick facility.[11] Spirit opened a composites manufacturing facility in Kinston, North Carolina on July 1, 2010, to build sections of the Airbus A350.[12] Those sections are then sent to another Spirit plant in Saint-Nazaire, France, where they are partially assembled before being sent on to Airbus in Toulouse for final assembly.[13] During this time, Spirit also won the contract to win the contract to build the wings for the Gulfstream G280 and G650.
Onex sold its final shares of Spirit in 2014 and at that time it has made $3.2 billion on its ownership of the company.[14]
On October 31, 2019, Spirit acquired Bombardier Aviation's aerostructures activities and aftermarket services operations in Belfast (a former Short Brothers plant) and Casablanca, with the acquisition completing a year later in October 2020.[15] The deal gives Spirit a bigger place in Airbus' supply chain as the Belfast plant produces the wings for the Airbus A220, while the Casablanca factory produces the mid-fuselage for the A220.[16]
In February 2020, Spirit acquired Fiber Materials Inc., a company which specializes in making high-temperature materials and composites, primarily for the defense and space industry, operating out of facilities in Biddeford, Maine and Woonsocket, Rhode Island.[17] [18] In July 2021, the company purchased Applied Aerodynamics, an aerostructures maintenance, repair and overhaul (MRO) facility in Dallas.[19]
After years of losses and quality control problems at Spirit, Boeing started talks to re-acquire Spirit AeroSystems in March 2024. At the time, both Boeing and Spirit faced intense scrutiny after an uncontrolled decompression on Alaska Airlines Flight 1282, that occurred when a door plug (a structure installed to replace an optional emergency exit door) on the Boeing 737 MAX 9 aircraft, which was not bolted in place due to a manufacturing error, blew out.[20]
After months of talks, Boeing agreed to buy back Spirit AeroSystems in an all-stock transaction, worth $4.7 billion in equity value and $8.3 billion in enterprise value when including the assumption of Spirit's debt. As part of the deal, Airbus agreed to take over Spirit's unprofitable European operations, receiving $559 million in compensation from Spirit. The deal is expected to close in mid-2025, pending regulatory approval.[21] [22]
As part of the deal, Boeing will take ownership of the Wichita and Tulsa plants it previously operated, along with the MRO facility in Dallas. Airbus will take over the facilities in Casablanca, Kinston and St. Nazaire, along with A220 production assets in Belfast. Spirit also plans to divest its operations Subang and Prestwick, along with Fiber Materials, and non-Airbus operations in Belfast.[23]
In 2010, 96% of Spirit's revenue came from its two largest customers: 85% of sales were from Boeing, 11% from Airbus.[24]
After planning to take Spirit public,[25] at initial public offering on November 21, 2006, the firm's stock rose 10% on the first day.[26] In November 2006, Onex owned 58% of Spirit, which resulted in 92% of voting power, as its shares conferred "supervoting" power. The chief architect of the Onex purchase of Spirit was Nigel S. Wright, who was later Chief of Staff for the Canadian Prime Minister until his resignation as part of an expense scandal. In August 2014 the Onex Group sold all of its remaining shares of Spirit. Over the course of the nine-year investment, the Onex Group received aggregate proceeds of approximately $3.2 billion on its initial $375 million investment.[27]
Spirit's principal products are metal and composite structural sub-assemblies ("aerostructures") for Boeing, Airbus, and Bombardier airliners, as well as business aircraft (and their military variants).[28] [29] [30] It also provides various other aerospace products and services.[31]
Spirit's initial and continuing role has primarily been the manufacture of the Boeing 737 fuselage, and other components. As well as the nose and forward-cabin sections of most Boeing jetliners. The Boeing sub-assemblies are mostly built at Spirit's former Boeing-Wichita factory complex, near its headquarters in Wichita, Kansas. Spirit also manufactures major fuselage and/or wing sub-assemblies for current Airbus jetliners, mostly in its Tulsa, Oklahoma factory.
Spirit also manufactures parts and sub-assemblies for various other aircraft manufacturers at various sites in the United States and the United Kingdom—including the fuselages of the Sikorsky CH-53K heavy-lift helicopter. It also produces or adapts various other defense-related aerospace products for other manufacturers.
In December 2023, an employee of Spirit AeroSystems filled out a class action in federal court against the company, alleging that former employees repeatedly warned about safety problems and were told to cover up systematic quality control failures, undercount defects, records falsification and retaliation against employees raising safety concerns.[32]
On January 5, 2024, Alaska Airlines Flight 1282 experienced a midair emergency when a door plug blew out causing an uncontrolled decompression of the aircraft.[33] The fuselage and door plug are manufactured and initially assembled by Spirit AeroSystems, then shipped by train for final assembly at the Boeing Renton Factory.[34]