Spirit AeroSystems Shares Soar After Reaching Production Deal With Boeing

By
Naomi Buchanan
Naomi Buchanan
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Naomi Buchanan is a reporter at Investopedia breaking down news stories that impact investors.
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Published October 18, 2023
03:28 PM EDT
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Key Takeaways

  • Spirit AeroSystems made a deal with Boeing to shore up its production system.
  • The agreement comes after quality issues involving Spirit AeroSystems delayed Boeing deliveries.
  • Spirit AeroSystems shares jumped over 20% in intraday trading on Wednesday after the deal was announced.

Shares of Boeing supplier Spirit AeroSystems (SPR) jumped on Wednesday after reaching a production agreement with Boeing (BA) to support its production system after quality issues delayed Boeing deliveries.

The deal comes after a series of defects identified earlier this year involving Spirit AeroSystems that halted and delayed Boeing deliveries, with Boeing warning it could miss its delivery targets for the year.

"Our collective teams will focus on further generating supply chain performance and resiliency," Boeing President and CEO President and CEO Patrick M. Shanahan said, noting that the "united effort to synchronize our production systems will enable greater market responsiveness and delivery assurance."

"Boeing and Spirit will continue to work shoulder to shoulder to mitigate today's operational challenges," Spirit AeroSystems said in the agreement announcement.

Spirit AeroSystems shares were up more than 23% as of 3 p.m. ET on Wednesday following the news, while shares of Boeing were little changed. However, shares of both companies were still lower for the year, with Boeing shares down close to 5% and Spirit AeroSystems shares nearly 30% lower year-to-date.

BA, SPR

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  1. Spirit AeroSystems. “Spirit AeroSystems, Boeing Reach Agreement to Support Production Stability.”

  2. Reuters. "New Boeing 737 MAX supplier defect to delay aircraft deliveries."

  3. Spirit AeroSystems. “Spirit AeroSystems 737 Aft Bulkhead Statement.”

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