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Politicians and union leaders warned against the break-up of Spirit AeroSystems in Northern Ireland after Boeing’s $4.7 billion takeover of its former supplier left the region’s largest manufacturer in limbo.
In addition to Boeing’s acquisition of Spirit announced Monday, Airbus has also separately agreed to take over production the supplier carries out on its behalf for the A220 and A350 programs at four factories in the U.S., France, Morocco and Belfast.
Spirit has six factories in Belfast that make wings and fuselages (the main part of the aircraft) for Airbus A220 jets.
But the loss-making Northern Ireland arm also makes fuselages and other parts for Bombardier’s business jets, plus components for Rolls-Royce and Honda Aircraft. All of these are outside the complex deal and have no immediate buyer.
Spirit said Monday it plans to sell those, as well as operations in Scotland and Malaysia that support Airbus’ programs.
Steve Aiken, deputy leader of the Stormont Parliament in Northern Ireland and a member of the Ulster Unionist Party, feared that integrated activities in Belfast, including research and development, would be damaged if the activities were split up or moved elsewhere.
“That is the added value and that is split by splitting up the company,” he warned.
According to the GMB union, splitting up the company would create practical problems and leave 60 percent of employees not involved in Airbus production in limbo.
“It’s a holistic operation – there’s a lot of interdependence” with some employees working on both Airbus and other contracts, said Alan Malcolm, a senior union representative for GMB, who did not rule out strikes.
Northern Ireland is a supplier to many international aerospace and defence programmes. The sector, with a turnover of £1.9 billion, employs over 10,000 people, including in supply chains.
Kevin Craven, chief executive of aerospace and defence industry association ADS, told the Financial Times that the industry would be “very interested in retaining capacity” in Belfast.
Spirit bought the historic Belfast-based company when the Canadian industrial conglomerate put it up for sale in 2019. Before that, it was home to Short Brothers, which in 1909 claimed to be the world’s first aircraft manufacturer after receiving an order from American aviation pioneers the Wright Brothers.
According to insiders, Airbus could even consider outsourcing the fuselage work for the A220 to a third party in the future. They warned that it would likely take months before a final decision is made.
Spirit’s production for Bombardier could make it a logical new owner for the parts Airbus did not acquire, and for future work on the A220 fuselage.
A trade expert in Northern Ireland said: “Doing a deal with Bombardier would be the obvious answer, but that might require writing a big cheque.” Bombardier was not immediately available for comment.
Airbus said that as a result of the “proposed sale of Spirit to Boeing, [it] was in the process of acquiring the most critical work packages directly related to Airbus programmes”. At this stage, it added, “no operational decisions have been taken on how we would manage these work packages”.
Airbus would work with the UK and Northern Ireland governments to “stabilise and improve” Spirit’s operations, the company added.
Northern Ireland’s Economy Minister Conor Murphy said a “responsible owner” was needed for the work not done by Airbus that would protect skilled jobs.
“We are committed to working closely with Spirit to help them identify potential buyers and best support the people in those locations,” a person close to Boeing said, referring to the assets Spirit is seeking to sell to third parties.
Airbus will receive $559 million in compensation from Spirit and pay a symbolic $1 for the assets. If Spirit fails to find a third-party buyer for the Prestwick work, Airbus will take over operations, the planemaker said Monday.
Airbus has said it plans to ramp up production of the A220 to 14 planes a month by 2026. Spirit said in May it planned to increase capital spending and staffing in Belfast this year to meet demand.