SEATTLE (Reuters) – Shares of Spirit AeroSystems Holdings Inc. (RPD.N) tumbled 13% on Tuesday after the key Boeing Co (BA.N), the supplier warns that it sought to obtain relief from its lenders due to Boeing to reduce the delivery of parts substantially this year.
As the Mind wrestling with the fallout on the Boeing 737 MAX production, its chief executive, Tom Gentile, and other officers of the company have been in Seattle this week for discussions with Boeing on the production rate and the possibility of the continuation of financial support from Boeing, a person familiar with the matter said.
A Boeing spokesman declined to confirm or comment on some of the talks between the companies, but said Boeing was “working closely with all our suppliers to ensure that we all get out of this situation safe, healthy and ready for the future.”
Earlier this year, the Spirit reached an agreement with Boeing to 216 shipsets, such as complete sets of parts are known, in 2020, but that has been reduced to 125 shipsets in May, as the sars coronavirus spread of the crisis and several airlines started to delay aircraft deliveries.
The mind now expects to deliver only 72 shipsets to Boeing. This compares with 606 shipments in 2019, Jefferies told clients Tuesday.
The company has already delivered 37 737 shipsets to Boeing, and expects to produce and deliver the remaining 35 shipsets on the rest of the year. But Boeing has said in the Spirit of do not deliver most of fuselages through July, the person familiar with the matter said.
The spirit of the profits were already under pressure after Boeing halted production of its best-selling 737 MAX from January until the end of May, after a ban on safety after two fatal accidents.
After the jet’s grounding, Boeing has kept its production for the nine-month period and, earlier this year, paid Spirit $ 225 million to support the 737 MAX production and to defer the repayment of another $ 123 million in advance.
Reporting by Eric M. Johnson in Seattle; Editing by Leslie Adler and Cynthia Osterman
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