Spirit AeroSystems Furloughs 700 Workers Amid Boeing Strike
Spirit AeroSystems announced on Friday that it will furlough 700 employees for 21 days as the ongoing strike at Boeing, which began in mid-September, continues to strain the supplier’s finances and inventory capacity. The furloughs, first reported by Reuters, will impact workers involved in Boeing’s 767 and 777 widebody jet programs, which have been halted due to the strike by over 33,000 U.S. factory workers.
The decision comes as Spirit Aero faces a growing backlog of fuselages with no space for additional storage. Spirit CEO Pat Shanahan acknowledged the toll on affected employees, saying, “We recognize the impact this has on our valued teammates and their families, and we are committed to supporting them through this period.”
Financial Pressures Mount as Strike Drags On
Spirit Aero has already implemented several cost-saving measures, including a hiring freeze and restrictions on travel and overtime. The Wichita-based company, heavily reliant on Boeing’s production ramp-ups, has been particularly affected by the strike and warned of potential layoffs if the work stoppage continues past November.
Boeing’s supply chain has been hit hard over recent years, facing multiple crises including the 737 MAX grounding, the pandemic, and ongoing quality issues. The current strike adds another layer of disruption, with suppliers like Spirit Aero having invested heavily in materials and tooling in preparation for increased production of Boeing jets.
Production and Financial Impacts on Spirit Aero
Spirit’s financial situation has deteriorated, with second-quarter losses more than doubling. The company has already scaled back 737 MAX fuselage production from 31 units per month to 21 between August and October, with the possibility of further cuts looming. Boeing, which has been regularly checking in on Spirit’s financial health, is expected to provide further assistance.
Delays in inspecting fuselages at Spirit’s Kansas facility have already slowed deliveries to Boeing’s Renton, Washington, plant, making it less likely that Boeing will meet its goal of producing 38 MAX jets per month by the end of 2024. Spirit has increased inspections during the strike to prepare more fuselages for delivery once the stoppage concludes.
Spirit Aero shares fell 0.6% in early trading but are still showing gains for the week.