16 March 2013

Airbus might take over Spirit St.Nazaire French plant

Spirit´s 5378 m2 facility in Saint-Nazaire is dedicated to receive center fuselage frame sections from USA, assembly them and deliver to Airbus plant the “section 15” of the A350 XWB.  The plant employs 24 and at full production, it will employ about 75.

Spirit has been identified as a critical Tier1 and a very close monitoring team is onboard, reporting directly to Didier Evrard A350 Program Director.

Based on the article published in Les Echos and Challenges (where is quoted a French CFE-CGC union leader, Francoise Vallin), Airbus is talking with Spirit AeroSystems about the possibility of buying Spirit’s assembly plant in Saint-Nazaire, in order to get the program back on track.

The move could be a “dent to Spirit’s credibility as a major structures supplier,” said RBC Capital Markets aerospace analyst Robert Stallard.

“Production can be equally, if not more risky, than development, first flight and certification,” Stallard wrote. “Today’s report suggests Airbus is being proactive with (Spirit). … Risk will remain in the program well into the production ramp.”

Other aerospace analysts consider that the move could be positive for Spirit, because it could reduce the company’s risk on the program. Spirit’s filing with the Securities and Exchange Commission said that the company had received additional assistance from Airbus on the program and was working to have its production certificate restored.

“If Airbus were to purchase the facility, we believe it could reduce some of Spirit’s risk on the A350 program,” Pearlstein said in the report. “We believe most of the dollar value of Spirit’s content is in the manufacturing in North Carolina and so moving the assembly facility to Airbus should not cause a large drop in its content.”

“But Airbus has been open about the delays coming from Spirit and it may be able to reduce the A350 schedule risk by insourcing the facility,” Pearlstein wrote. “Therefore, if not much revenue is at stake, but the risk could be reduced, it could be positive for the A350 program and Spirit.”

The change could be positive and negative for Spirit, said Teal Group analyst Richard Aboulafia. “It depends on the terms,” he said.

It could give Spirit more resources and allow the company to focus financial and engineering resources on other challenges, he said. “On the other hand, it cuts back on their plan to diversify their workforce portfolio.”

Selling the plant to Airbus would affect Spirit jobs in France, Aboulafia said.

“It would probably mean Airbus personnel would take over these activities unless they were offered jobs,” he said. “I would assume they would replace them with their people.” On the other hand, Spirit would have more resources to focus elsewhere. “I would assume it doesn’t mean that Spirit’s role (on the A350) goes away completely,” he said.

Based on the article “Airbus va reprendre son sous-traitant amĂ©ricain Spirit” published in Challenges

No comments:

Post a Comment