Boeing Buys Company Responsible for Door Blowout. The Stock Rises.

Spirit AeroSystems is a piece of Boeing once again. (Nick Oxford/Bloomberg)

Key Points

• Boeing acquired Spirit AeroSystems, aiming to improve production stability and quality after a January 2024 incident.
• Boeing’s stock increased by 2.2% to $206.27 following the acquisition announcement, while Spirit AeroSystems closed at $39.50.
• The acquisition involved dealing with Spirit AeroSystems’ Airbus business. Airbus received over $400 million for taking back its parts operations.

Boeing has taken another small step on its road to recovery.

Monday, the commercial airplane maker announced it had finally acquired its fuselage supplier Spirit AeroSystems, a step Boeing hopes will help improve production stability and quality.

Spirit Aero makes fuselages for the 737 MAX and structures for the 767, 777, and 787.

Boeing stock added 2.2%, closing at $206.27, while the S&P 500 and Dow Jones Industrial Average fell 0.4% and 0.5%, respectively. Spirit AeroSystems shares finished life as an independent company at $39.50.

Boeing agreed to acquire its fuselage supplier in July 2024, demonstrating the company’s “commitment to aviation safety.” It once owned Spirit Aero, but it sold the fuselage maker to a private-equity firm in 2005, and the private-equity firm sold shares to the public in 2006 at $26 apiece.

Part of the idea was to unlock value by letting Spirit AeroSystems grow by seeking non-Boeing business. It did get some Airbus work, but manufacturing quality appears to have suffered. The impetus for Boeing’s reacquisition of the company was the January 2024 emergency door plug blowout of an Alaska Air 737 MAX while it was in flight.

Former Boeing CEO Dave Calhoun told a congressional panel in 2024 that Boeing’s plan to outsource some parts might have gone too far, causing the company to lose a measure of control over quality.

Current CEO Kelly Ortberg called the deal “a pivotal moment in Boeing’s history and future success,” in a news release, adding, “As we welcome our new teammates and bring our two companies together, our focus is on maintaining stability so we can continue delivering high quality airplanes, differentiated services, and advanced defense capabilities for our customers and the industry.”

Part of the reason the deal took so long to complete, aside from regulatory approvals, was figuring out what to do with the Airbus business. Airbus was paid more than $400 million for taking its parts business back from the supplier.

Spirit AeroSystems hadn’t generated positive free cash flow since 2019, according to FactSet, the year of the second tragic 737 MAX crash.

The acquisition is another part of the process of putting that painful period behind Boeing. It was a Barron’s stock pick on Oct. 31.

Write to Al Root at allen.root@dowjones.com