Boeing (BA) has agreed to buy Spirit AeroSystems (SPR) in a $4.7B all-stock deal as part of an effort to improve quality and safety. However, Boeing is still under fire from the US Department of Justice for violating FAA regulations.
Boyd Group International president Mike Boyd and former Wall Street Journal aerospace reporter Andy Pasztor join Morning Brief to give insight into how the purchase will affect Boeing’s operations.
“I think after this deal comes down, probably [Boeing CEO] Calhoun will see the front door. He should have been kicked out the door before him. He is responsible for this. Hopefully we will see an improvement at the FAA. They’re responsible for the oversight. And they they failed before the Max. Now they failed since the Max,” Boyd tells Yahoo Finance.
Separately, Pasztor points out that Boeing will only face a small penalty for its 737 Max crashes despite pressure from victims’ families: “The reason [a greater penalty] isn’t happening is because of the chaotic days of the end of the Trump administration, the agreement that Boeing signed with the Justice Department in 2021 essentially poisoned the well for any strong, forceful action by the Justice Department in a very clear break from Justice Department practices over the years, the Justice Department said it found no evidence specifically that senior executives were involved in any of the potential fraud related to the to the Max design. The Justice Department almost never does that.”
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