March 25, 2013
Credit: Spirit AeroSystems
Spirit AeroSystems, commercial aviation's biggest independent airframe maker, is tapping the talents of an executive who made his mark in high-profile defense programs with the selection of Larry A. Lawson as its president and CEO.
Lawson, who was executive vice president of Lockheed Martin Aeronautics, will take Spirit's leadership reins April 6. He succeeds Jeff Turner, 60, who remains on Spirit's board.
An electrical engineer by training, Lawson is leaving a Lockheed business unit with $14.9 billion in revenues and 26,000 employees for one with $5.4 billion in revenues and 16,000 employees, 11,000 at its home base in Wichita.
“We believe his appointment will create additional investor confidence in [Spirit's] prospects,” says Jefferies aerospace analyst Howard A. Rubel. At Bank of America Merrill Lynch, Ronald J. Epstein cited a resume filled with “impressive work experience” but questioned how well Lawson will fit into the business environment of commercial aerospace. “In defense, cost overruns . . . have been the modus operandi in recent years,” Epstein says. “Defense contractors do not generally take as much capital risk as their commercial counterparts.”
After Boeing's 2005 spinoff and its 2006 initial public offering, Turner led Spirit in an aggressive expansion of its business base. It now builds airframe structures for Airbus's A320, A350 and A380 programs; Gulfstream's G280 and G650; the Bombardier CSeries and Mitsubishi Regional Jet as well as Sikorsky's CH-53K for the U.S. Marines.
Spirit has added factories in Scotland, Malaysia and France, plus new facilities in the U.S., most notably a 500,000-sq.-ft. plant in Kinston, N.C., for the A350.
But the expansion has come at a price. Last year, Spirit reported a $645 million charge on development programs and an 82% drop in net income.
By December, Airbus CEO Fabrice Bregier was voicing dissatisfaction with Spirit's performance on the A350. Early this month, Airbus dispatched a team of engineers to Kinston to work through production lags on the center fuselage. The factory also builds the aircraft's fixed leading edge and front spar.