Spirit AeroSystems Holdings Inc. (SPR:US), which builds sections of every Boeing Co. (BA:US) airplane, named the former head of Lockheed Martin Corp. (LMT:US)’s F-35 program as its new chief executive officer.
Larry Lawson, 55, takes over April 6 at Wichita, Kansas- based Spirit as he shifts to supplying components for commercial airliners from a career working on military aircraft. He retired yesterday from Lockheed Martin.
He joins Spirit about five months after the company recorded $590 million in charges and said it couldn’t meet its forecast as it struggled to simultaneously develop parts for jets, including Boeing’s troubled 787 Dreamliner. He oversaw production of the F-35, the Pentagon’s most expensive weapons program and a plane plagued by seven years of delays.
A lack of airliner experience may make for a “challenging” leadership transition for Spirit, which has faced problems as new-plane programs overlapped, said Doug Harned, an analyst with Sanford C Bernstein in New York.
Lawson succeeds Jeff Turner, who announced his retirement in November, shortly after the company announced the charges and the inability to meet its financial forecast. Turner, 61, was Spirit’s CEO since 2005 and will remain on its board.
Spirit, which was spun off by Boeing in 2005, is juggling new products as it has expanded its customer base to include Airbus SAS and business-jet builders. Planemakers are increasingly turning to suppliers such as Spirit to share the risk of developing new models.
Spirit’s leadership team is “very well-versed in commercial aircraft, which would strongly support Lawson’s impeccable experience in execution-driven program management,” said Ken Evans, a spokesman for Spirit. “So we believe he’ll be a very good fit. We expect it will also help to have Jeff Turner remain on the board and help with the transition.”
Lawson’s appointment may boost investor confidence in Spirit’s prospects, given his experience with mass production of parts for aircraft frames, said Howard Rubel, an analyst with Jefferies & Co. in New York.
“He has fostered good relations with large sophisticated customers, understands the needs of a unionized workforce, and has run highly profitable programs,” Rubel wrote in an investor note today.
Lockheed Martin’s F-35 program, under Lawson, was criticized by the U.S. Air Force last month for trying to “squeeze every nickel” out of the Defense Department. Boeing, meanwhile, has said repeatedly that it’s working with suppliers to reduce costs as it boosts production more than 60 percent in the four years through 2014.
Spirit declined 0.5 percent to $18.89 at the close in New York. The shares have dropped 25 percent in the past year.
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