Spirit AeroSystems [NYSE: SPR] has announced it is in receipt of communication from Boeing, directing the company to pause additional work on four 737 MAX shipsets and to avoid starting production on sixteen 737 MAX shipsets to be delivered in 2020, until otherwise directed by Boeing, the company said.
The communication supports Boeing´s alignment of near-term delivery schedules to its customers´ needs in light of COVID-19´s impact on air travel and airline operations, and in order to mitigate the expenditure of potential unnecessary production costs.
Based on subsequent communication with Boeing regarding 2020 737 MAX production, Spirit believes there will be a reduction to Spirit´s previously disclosed 2020 737 MAX production plan of 125 shipsets. Spirit does not yet have definitive information on what the magnitude of the reduction will be but expects it will be more than 20 shipsets.
Due to the matters described above, Spirit has elected to place certain Wichita hourly employees directly associated with production work and support functions for the 737 MAX program on a 210calendar day unpaid temporary layoff/furlough effective Monday, June 15.
Spirit AeroSystems Inc. designs and builds aerostructures for both commercial and defense customers. With headquarters in Wichita, Kansas, Spirit operates sites in the US, U.K., France and Malaysia.