Airplane fuselages bound for Boeing’s 737 Max production facility sit in storage at their top supplier, Spirit AeroSystems Holdings Inc, in Wichita, Kansas, U.S. December 17, 2019.
Nick Oxford | Reuters
Shares of Spirit Aerosystems, which makes fuselages for Boeing’s 737 Max jets, surged Friday after a report that Boeing is in talks to acquire the company, as both companies scramble to stamp out manufacturing flaws on the top-selling plane.
Spirit was up 13% as of late morning on Friday while Boeing’s were down about 1% after the report. Spirit Aerosystems had a market capitalization of $3.3 billion as of Thursday’s close.
Spirit has hired bankers to explore options and has had early talks with Boeing, the Wall Street Journal reported Friday.
“We do not comment on market speculation,” a spokesperson for Spirit Aerosystems told CNBC. Boeing also declined to comment.
Boeing in 2005 spun off operations in Kansas and Oklahoma that became the present-day Spirit Aerosystems. About 70% of Spirit’s revenue last year came from Boeing, and about a quarter comes from making parts for Boeing’s main rival, Airbus.
The report of repurchase talks comes less than two months after a section of a Boeing 737 Max 9 plane blew out during an Alaska Airlines flight. The Federal Aviation Administration temporarily grounded all of the planes in January, leading to investigations into the accident and Boeing’s production lines.
It was the latest and most serious in a host of flaws on the Boeing 737 Max, Boeing’s best-selling jet.
The bolts on the door plug of the Max involved in the January accident appeared not to have been attached when it left Boeing’s Renton, Washington, factory, according to a preliminary report from the National Transportation Safety Board.
Boeing has disclosed several production problems and quality flaws on the fuselages that Spirit makes, including incorrectly drilled holes and incorrect spacing on some fuselage components, problems that slowed deliveries of new jets to airlines.
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