Warnings have been issued by both political and union figures, following the potential fragmentation of Spirit AeroSystems in Northern Ireland, as a result of the recent $4.7bn acquisition of its former supplier by Boeing. This move has left the status of the area’s largest manufacturing company uncertain. The rival aviation giant, Airbus, has also disclosed its intentions to assume control of production done by Spirit for its A220 and A350 programmes across several global plants – situated in the USA, France, Morocco, and Belfast.
Six production plants located in Belfast that belong to Spirit, manufacture wings and fuselages – the main structure of aircrafts – for the Airbus A220 jets. However, the loss-incurring Northern Irish operation also provides fuselages and additional parts for Bombardier’s business jets, as well as components for Rolls-Royce and Honda Aircraft. These businesses are all excluded from the intricate deal. Spirit expressed on Monday its intentions to sell these in addition to operations in nations like Scotland and Malaysia that cater to Airbus programmes.
Steve Aiken, the deputy speaker of Northern Ireland’s Stormont assembly and an Ulster Unionist party member, spoke of his concern that the consolidated operations situated in Belfast – encompassing research and development – could be jeopardised if these activities were either broken up or moved elsewhere. In his words, such a situation would remove the company’s “value-added”.
The prospect of a division might lead to practical challenges and put 60 per cent of the workforce – who are not involved in Airbus production – in uncertainty, according to the GMB union. The organisation emphasised the integral nature of operations, with workers being employed across both Airbus and other contracts. Industrial action has not been ruled out, as mentioned by Alan Malcolm, senior GMB union representative.
The aerospace and defence sector in Northern Ireland includes suppliers to prominent global aerospace and defence programmes and brings in £1.9bn in revenue, employing more than 10,000 individuals – this includes those working within supply chains. The Aerospace and defence trade body ADS’s CEO, Kevin Craven, conveyed to the Financial Times that the industry is particularly interested in maintaining capacity in Belfast.
Spirit gained ownership of the historic Belfast enterprise when the Canadian industrial conglomerate decided to sell it in 2019. Prior to this, the enterprise was the base of Short Brothers, which in 1909 claimed to be the world’s first aviation manufacturer after securing an order from the US aviation pioneers, the Wright brothers.
Airbus is said to be contemplating the potential sale of its A220 fuselage activities to a third party in the future, according to anonymous insiders knowledgeable about the issue, who also warned that it could be several months before a final choice is made.
Spirit’s manufacturing involvement with Bombardier makes the company a potential contender to take over the business operations Airbus does not keep, including future A220 fuselage tasks. An industry insider from Northern Ireland noted that an agreement with Bombardier would be a logical move, but it could involve a significant financial commitment. Bombardier has yet to comment on the situation.
Airbus has reported that as Spirit is proposed to be sold to Boeing, Airbus will be responsible for the critical job packages that directly affect its own programmes. Airbus has yet to decide how it will handle these work packages operationally. Airbus plans to collaborate with the UK government and Northern Ireland’s executive to enhance and stabilise Spirit’s operations.
Northern Ireland’s economy minister Conor Murphy has expressed the need for a ‘responsible owner’ for the non-Airbus tasks to safeguard skilled employment positions. A Boeing insider has indicated the company’s commitment to finding potential buyers for the parts of Spirit’s operations that are being sold to third parties.
Airbus is set to receive $559 million in compensation from Spirit and will purchase the assets for a nominal fee of $1. If Spirit does not secure a third party buyer for the Prestwick activities, Airbus will take control, Airbus reported on Monday.
Lastly, Airbus has revealed its intention to increase the production of A220 to 14 units per month by 2026. In May, Spirit announced plans to augment capital outlays and staffing in Belfast this year to meet the anticipated demand.