Why Shares of Spirit AeroSystems Are Falling Today

Shares of Spirit AeroSystems Holdings (NYSE: SPR) opened Monday down 10% after the aerospace component supplier announced plans to lay off 1,450 workers. Spirit is a major supplier to Boeing (NYSE: BA) and Airbus (OTC: EADSY), and with airplane production rates scheduled to fall in the quarters to come, Spirit's business is going to take a hit as well.

Spirit, a onetime Boeing subsidiary that makes fuselages and other large components for commercial and military aircraft, has seen its shares fall 70% so far in 2020 on concerns that the COVID-19 pandemic will force airlines to retrench, slowing commercial aircraft sales for years to come. It appears those fears were well founded, as Boeing and Airbus are both planning to make fewer planes in the future.

Fewer planes mean fewer parts needed, and Spirit over the weekend announced it will reduce employment at its factories that support commercial airplane manufacturing.

Source Fool.com