Spirit AeroSystems Rehiring Workers As Production On 737 Max Slowly Picks Up

May 5, 2021

Despite a rocky financial start to 2021, Spirit AeroSystems said it has begun rehiring workers following massive layoffs a year ago.

The Wichita-based aviation manufacturer released its first-quarter earnings on Wednesday. The company said it lost about $126 million in the first quarter of the year, which was about a 25% improvement over the same quarter last year.

And Spirit says it will continue to slowly increase production rates on the financially critical Boeing 737 Max program. The program accounted for nearly half of the company’s revenue in 2019.

Spirit president Tom Gentile said those production increases have allowed the company to rehire some workers.

“So far to date, between hourly and some salaried employees, we've recalled about 600 employees back in Wichita,” Gentile said during a conference call with analysts. “And we expect to recall probably double that over the course of the year."

While 737 Max rates will increase over 2020 production, they will still be less than a third of pre-pandemic levels.

Spirit is coming off a difficult year in 2020. The grounding of the 737 Max — which was involved in two fatal crashes — and the pandemic led to nearly $1 billion in losses and 8,000 layoffs.

“The first quarter of 2021 provided to be a very challenging start to the year while uncertainty around the precise trajectory of the pandemic recovery remains,” said Mark Suchinski, Spirit’s senior vice president and chief financial officer. “We are beginning to see positive signs in domestic air traffic demand.”

Spirit officials say they hope that an increase in air travel will lead to more airliner sales for Boeing in the future.

In the meantime, Spirit said it will use excess manufacturing capacity to grow Spirit’s defense work. Those revenues grew 20% in 2020, and officials hope to grow them another 15% this year.

“We continue to see 2021 as a bridge year for Spirit and commercial aviation industry,” Suchinski said.