Under pressure on plane safety, Boeing is buying stressed supplier Spirit for $4.7 billion
Under pressure on plane safety, Boeing is buying stressed supplier Spirit for $4.7 billion
Boeing, which previously owned Spirit, said it is bringing the supplier back into the Boeing fold to improve plane quality and safety, which has come under increasing scrutiny.
Boeing announced plans to acquire key supplier Spirit AeroSystems for $4.7 billion, a move that 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.
“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.
“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.
Quick, someone post the press release when Boeing outsourced Spirit. I bet they said the outsourcing was also in the best interest of the flying public.
Boeing announced in April 2004 that it was studying the possible sale of its plants in Wichita , Tulsa and McAlester . Boeing included balancing the interests of employees, customers, shareholders and its plant communities in its criteria for the decision.
"We firmly believe that this decision provides the best available outcome for the Wichita/Tulsa Division and its plant communities by creating new opportunities for sustained growth as a separate operation. Onex shares this perspective, and we look forward to a long and productive relationship together," Mulally said.
I should name my wallet "The Flying Public"
“We believe this deal is in the best interest of
the flying public, our airline customers, the employees of Spirit and Boeing,our shareholdersand the country more broadly,” Boeing President and CEO Dave Calhoun said in a statement late Sunday.Fixed that for them.
It's funny how mergers and acquisitions are always the cure all for every company's woes, but every time one company gobbles up another, everything always gets worse (especially Boeing). Then the cure for that is to....buy another company. It's like the corporate equivalent of "Of course having a baby would save our failing marriage"
I initially thought Boeing was buying Spirit Airlines.
Yes let's consolidate a corrupt industry even further!!!
Pinky promises prices will go down, plebs!
Vertical integration with a supplier that used to be part of Boeing helps make it safer. The whole problem is Boeing has moved further and further away from their suppliers, to the point they don't pay them up front for development, and they're literally making their contractors fight each other to come up with the cheapest possible parts.
Anything that moves the needle back the other way is good, but they still have a long way to go.
Yes. Spend more money rather than change anything. That makes sense. They probably should also do a stock buyback again too just to be sure.
This is changing things. Vertical integration of a key supplier isn't necessarily a bad thing.
And this is sort of like if GM woke up one day and decided to buy back Allison Transmission. Sprit was part of Boeing. It got sold off by bad leadership. Sprit never landed many other contracts past Boeing. Boeing is now buying them back to reintegrate a piece of old Boeing leadership never should have sold.
Fire the board, liquidate the company, start over. The cancer of McDonall Douglas must be excised.
Revive North American Aviataion my beloved
Yeah, I’m just going to assume this is Boeing buying evidence of crimes and the silence of Spirit’s executives and board.
For people lacking context, Boeing split off and sold their division that became Spriti Aerosystems. The theory at the time was that Boeing's core competency wasn't building airplanes, it was managing relationships with other vendors. In particular, the actual plane manufacturing part of the company was undesirable due to perceived poor "Return on Net Assets." The theory they pitched to shareholders was they should sell off non obviously profitable divisions so they reduced asset liability while keeping the same or better profits.
That was their explanation, of course it was a terrible idea.
"I know you didn't like when I tried to sell your baby to score some meth, but if you just give me some crack, I'm sure I can think up a solution that'll make everyone happy."
Spirit was formed when Boeing sold its Wichita division to investment firm Onex Corporation in 2005.
https://en.wikipedia.org/wiki/Spirit_AeroSystems#History
Lol