Story ID: GPspiritboeing01302020
Spirit Signs New 737 Max Supply Deal
By: Gregory Polek
Caption: A new supply agreement between Spirit and Boeing anticipates fuselage deliveries reaching 52 per month in late 2022.
Word Count: 245
Spirit AeroSystems has reached an agreement with Boeing calling for the Wichita-based supplier to restart production of 737 Max fuselages “slowly” and accelerate deliveries throughout the year to reach a total of 216 shipsets in 2020, Spirit announced on Thursday.  While the parties continue to negotiate other terms, Spirit said it does not expect to achieve a production rate of 52 shipsets per month until late 2022.

The agreement offers a clue to the 737 Max production ramp plan at Boeing, which said Wednesday that it expects not to reach full production for several years. Spirit said the sides based their supply agreement on several assumptions, including Boeing's expected production rate and the successful return to service of the 737 Max.

Separately, Spirit on Thursday said it accepted the resignations of CFO Jose Garcia and principal accounting officer and controller John Gilson following an ongoing review that found the company did not comply with its accounting processes related to certain potential contingent liabilities received by Spirit after the end of third quarter 2019. Although Spirit said it does not think the non-compliance will result in a restatement of its financial statements for the third quarter ending September 26, 2019, or materially affect the financial statements for the 2019 fiscal year, the resignations of Garcia and Gilson came "in light of the findings." The company named Mark Suchinski and Damon Ward as replacements for Garcia and Gilson, respectively. Ward takes over as controller and principal accounting officer on an interim basis.