Airbus Paid To Take Irish Factory As Part Of Boeing-Spirit Deal

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Airbus is being paid $559 million to take over an Irish aircraft parts factory as a result of the Boeing’s acquisition of Spirit Aerosystems. Boeing announced Monday it had bought Spirit and the main part of the deal was the Wichita plant it sold to Spirit 20 years ago. The $4.7 billion deal is part of Boeing’s effort to tighten quality control after a series of tragic and embarrassing accidents and mishaps. The Monday deal will give Boeing control of the Kansas facility that builds the fuselages for the 737 MAX series. It was in that plant where the chain of events began that led to the loss of a door plug in an Alaska Airlines MAX 9 last January in Oregon. But to get control of the Wichita operation, Boeing had to ensure Spirit’s other major customer Airbus would continue to get the parts it needs.

The former Spirit facilities in Belfast (originally the Shorts Aircraft plant) build major components for Airbus’s A350 and A220 aircraft and obviously couldn’t continue to do so with Boeing at the helm. So Boeing agreed to take a symbolic $1 payment from Airbus for the facilities used to make Airbus parts. Then Spirit used $559 million of the money it got from Boeing to compensate Airbus for having to take over building parts for its own airplanes.

It’s even more complicated than that. Spirit also makes parts for Bombardier business jets and Boeing will be assuming that business. In fact only about 40% of the work in Belfast goes to Airbus components. How the rest of it is managed or carved up is a major concern for Northern Ireland business and union leaders. Bombardier used to own the Belfast plant but sold it to Spirit as part of a massive asset liquidation in 2020. The plant is Northern Ireland’s biggest manufacturing concern with about 3,500 skilled workers.

Russ Niles
Russ Niles is Editor-in-Chief of AVweb. He has been a pilot for 30 years and joined AVweb 22 years ago. He and his wife Marni live in southern British Columbia where they also operate a small winery.

24 COMMENTS

  1. Canadian taxpayers subsidized Bombardier 2billion+ loonies for the “C” series regional jets for what? A giveaway! Oh, I know… If you owe $2000.00 you’re a bum. If you owe $2000,000 you’re a bad credit risk. If you owe $2 billion you’re a good government investment. Pass the Pepto please.

    • You made me have to google a ‘loonie’ to figure out what you were talking about, Tom. At first I thought you were talking about liberals. If you’da said “Quid,” I would have understood.
      Thanks for the early AM chuckle 🙂

      • Do you know how stoopid you sound when you express your emotional need to “own the libs” by making a derogatory comment about them in an aviation-centric comments section.

        • I don’t follow. Canadian governments have subsidized Bombardier’s aerospace and rail divisions for decades, regardless of the political parties involved. When the folks in the C suite liquidated, I don’t think any of the “investments” were returned to Canadian taxpayers. We paid them for years to build high quality products. The plant at Downsview, which is less than a mile from me is now shuttered, as are the rest of their aviation operations, all sold off. It’s correct to talk of billions of loonies going to them, and now all gone.

    • And on the other hand we see the perfect success of conservative pig capitalism, where Boeing have to pay a ton just buy back a plant they sold primarily as a part of the Welch philosophy, which brought both GE and Boeing to their ‘great’ state they are in today. Hey – Pass the people and this is what you get.

      • I’m not sure your point,but the libertarians would say it’s all crazy since the governments shouldn’t be doing that in the first place. Of course, the libertarians can’t seem to form a decent political party, so what good are they?

  2. I am sure meetings between French cartesian, technocratic managers and Irish workers are to cherish.

  3. As a Canadian I was extremely proud of Bombardiers aviation accomplishments and was dismayed that the C series had to be sold to Airbus in order to get around Boeings obstruction to access the American market. However C series (now A 220s) are being produced in both the USA and Montreal and that’s good. Canada still has a healthy aerospace industry and we will surely continue to design and build aircraft.

  4. I assume the Spirit plant here in Kinston, NC will be joining Airbus now, as it is mostly dedicated to A350 work. That plant has received massive subsidies from NC taxpayers and smokers, since the “Golden Leaf Fund” has paid millions into keeping the Kinston Global Airpark afloat, one of the worst examples of government waste in my state, which has a long track record of malinvestments via corporate welfare, aka looting of taxpayers. Here’s hoping that Embraer and Pilatus continue growing their offerings to bring more competition into the market.

  5. I hope some overpaid MBAs have learned a valuable lesson here. Outsourcing core functions of your business is maybe not such a good idea.

  6. Seems to me that there is no obvious evidence of problems in Spirit’s work in producing components for Bombardier/Airbus.

  7. I wonder if they will move their headquarters back to Seattle. It would be a nice bit of symbolism.

    • More likely move the entire operation out of Seattle as the unions are already chomping at the bit for record pay increases. Seems a little silly to think its a good time for that seeing your employer is currently losing $billions. But, that’s unions for ya. There has to be a hell of a lot of execs that would just love to pull the plug on the entire commercial aircraft operation about now. Maybe we’ll be seeing the “last out of Seattle, please turn off the lights” billboards again. It’s pretty damn obvious the Seattle area cannot provide capable employees to assemble an aircraft. Just being facetious here folks. But who knows. If they keep this crap up it may just happen.

  8. So Boeing has to pay more than half a Billion dollars to their only competitor to help them build their directly comparable airplanes at what used to be a Boeing factory ? Really ?

    I am at a loss for words to describe just how incompetent senior Boeing management is.

  9. So Boeing paid a few billion to buy back something they never should have sold in the name of quality control. A door blows out, a few rivets are missing, a few extra holes here n there. How does that fix the in house MCAS issue, the in house quality control and management issues, and a whole lot more I cant think of at the moment? Hey Maude close the gate Bessy just got out.

  10. It was not at the Wichita plant where the sequence of events began. It was in Seattle, long before, when Boeing decided to adopt the profit enhancing LEAN Manufacturing program that caused the decision to divest themselves of the plant in the first place.
    Hundreds of us predicted the loss of quality control once Boeing no longer held sway over their suppliers and only a few less of us knew the problems that LEAN would cause.
    It’s a system that prohibits proactive planning and allows only “on time” provisioning. It totally ignores human nature and won’t allow innovation.
    What other result could have been expected? This was simply another example of people who’ve never done what they’re trying to improve with their classroom inspired theories.
    If Boeing survives it’ll be because they brought back the grey haired, been there-done that, group of people with a true interest in keeping the company alive as an American icon of manufacturing and innovative quality.

  11. I still want to know about the headline “General Court Martialed” – what was that about? Nothing in any of the stories…

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