Just one week after Wichita-based Spirit AeroSystems announced it had “substantial doubt” about its ability to continue as a going concern, Boeing is offering to help.
On Tuesday morning, Spirit announced that Boeing has committed to paying Spirit up to $350 million in advance payments, with the agreement calling for Spirit to produce Boeing products at rates required by Boeing.
According to Spirit, Boeing intends the money to address several Spirit issues, including: high levels of inventory; lower operational cash flows; a decrease in expected deliveries to Boeing; higher factory costs to maintain readiness; and lingering effects brought on by the recent strike at Boeing.
Spirit AeroSystems must repay 25% of the advance on April 30, 2026; June 30, 2026; Sept. 30, 2026; and Dec. 31, 2026.
A week ago, Spirit filed a quarterly form with the U.S. Securities and Exchange Commission, saying it would need additional liquidity to continue its operations during the next year.
In the SEC form, Spirit said it was considering strategies including customer advances, issuing securities or debt financing subject to any contract conditions, and restructuring operations to increase efficiency and decrease costs. That may include layoffs or additional furloughs.
That form became public the same day Spirit announced its current furlough of 700 workers will end on Nov. 18.
Earlier this year, Boeing committed to giving Spirit $425 million in advance payments.