Boeing buys back supplier Spirit in £3.7bn deal as it struggles to contain safety crisis

Boeing has agreed to buy an aerospace supplier in a £3.7bn deal as it tries to contain its ongoing safety crisis.

The scandal-hit airline said the acquisition of Spirit AeroSystems was in the “best interests” of its passengers.

Spirit manufactures and supplies key parts for Boeing airplanes, including the wings and main body of the aircraft.

Boeing previously owned the Kansas-based group before spinning it off in 2005 as it pressed ahead with plans to downsize the business.

But this strategy has come under fire in recent years as Boeing faces a series of safety issues.

The group was plunged into crisis in January after a faulty door panel, made by Spirit, caused a Boeing 737 MAX plane to explode in mid-air.

The incident, which occurred at an altitude of 16,000 feet on an Alaska Airlines flight, terrified passengers and caused all Boeing 737 Max aircraft to be grounded.

Production was halted and restarted at a reduced level at the direction of the Federal Aviation Administration (FAA).

Regulators also found more manufacturing issues at Spirit. In an attempt to ease concerns, Boeing will bring the supplier in-house.

“We believe this agreement benefits the traveling public, our airline customers, Spirit and Boeing employees, our shareholders and the country as a whole,” said Boeing President and CEO Dave Calhoun.

‘By reintegrating Spirit, we can fully align our business production systems, including our safety and quality management systems, and our workforce with the same priorities, incentives and outcomes, focused on safety and quality.’

Boeing accounted for about 70 percent of Spirit’s revenue last year, while about a quarter came from Boeing’s main rival, Airbus.

Under the deal, Airbus will take over parts of Spirit’s business that manage the manufacturing of its own aircraft.

Russ Mould, investment director at AJ Bell, said the move “makes sense” for Boeing.

“Spirit was at the center of manufacturing defects and safety concerns regarding its 737 Max aircraft, which have sent Boeing’s stock price plummeting. This move gives Boeing more control,” he said.

But Boeing’s problems remain. The US Justice Department has given the company one week to admit fraud charges or face a public trial over the fatal crashes of its 737 Max jets in 2018 and 2019.

Boeing would have to pay a criminal fine of 192 million pounds and agree to a three-year probation period, according to reports.