Spirit, Boeing enter into memorandum of agreement to improve aero supplier’s issues

(Reuters) – Spirit AeroSystems and Boeing entered into a memorandum of agreement to address issues that include the aero parts supplier’s higher levels of inventory, contract assets and lower operational cash flows.

Under the MoA, Spirit will maintain a production rate that supports Boeing’s contractual production demand. The plane maker will also pay Spirit an advance payment of $425 million.

Spirit will also provide to Boeing specified financial information on a weekly basis.

The MoA would also help navigate lower expected deliveries to Boeing and higher factory costs to maintain rate readiness.

(Reporting by Nathan Gomes in Bengaluru; Editing by Shilpi Majumdar and Shailesh Kuber)