WICHITA, Kan. — Moody’s Investors Service announced that it is downgrading the debt rating for Spirit AeroSystems, Inc. to junk-bond status after the major supplier of fuselages for Boeing’s troubled 737 Max announced massive layoffs last week.
Monday’s downgrade comes after Spirit announced Friday that it was laying off 2,800 workers in Wichita and that it planned smaller workforce reductions later this month at its plants in Tulsa and McAlester, Okla.
“The downgrade reflects our expectation that Spirits liquidity profile will quickly and materially erode in the absence of mitigating developments that remain largely out of the company’s control,” said Eoin Roche, Moody’s lead analyst for Spirit.
Spirit produced about 70 percent of the 737 Max, including the fuselage and other major components. Contracts with Boeing for the Max represents more than half of Spirit’s annual income. Spirit halted production of fuselages and other parts for the Max on Jan. 1, after Boeing told Spirit to suspend shipments.