Boeing supplier Spirit Aero expects 737 Max output to stay low

Spirit AeroSystems Holdings Inc. expects to produce Boeing Co. 737 Max aircraft bodies at a lowered rate for the rest of the year, pressuring its finances as the two companies work to improve quality in their factories. Boeing’s largest supplier only expects to ship around 350 fuselages for the cash-cow jetliner this year as the two manufacturers step up inspections under scrutiny from US regulators and lawmakers. Spirit has slowed its own production by about a quarter to a 31-unit monthly pace, it said as it reported first-quarter earnings on Tuesday. The disruptions will have a “material impact” on Spirit’s cash flow throughout 2024, the supplier said in a statement. The Wichita, Kansas-based manufacturer also said it has been unable to reach a deal with Airbus SE to raise prices on parts it supplies for the A220 and advanced A350 aircraft models, which resulted in a further drag on cash flow. Spirit posted a first-quarter adjusted loss of $3.93 per share compared to a 54 cent deficit estimated by analysts. Free cash flow was negative $444m in the quarter, far more than than the $69m use of cash in the prior-year period. The results underscore how Boeing’s crisis is pressuring the finances of the critical supplier and former unit the planemaker spun off in 2005. “The death throes of Spirit are hard to watch, as these 1Q numbers are pretty horrendous,” analyst Rob Stallard of Vertical Research Partners said in a note to clients on Tuesday. Boeing in March confirmed it was in discussions to acquire Spirit in an effort to bring more of its aircraft production under its direct control. The planemaker is working to stabilize its supply chain and bolster quality standards after a fuselage panel blew off a 737 Max 9 mid-flight in January. <br/>