Spirit AeroSystems Holdings, Inc. (NYSE:SPR) Q4 2023 Earnings Call Transcript

Pat Shanahan : It will be significantly different. And the heaviest weighting will be on quality. And right now, I’m really working to design it. So the system can’t — manipulation is probably too strong, but I want to make sure that it drives the right behaviors and we can measure true performance. I’ll just do a shout out to Donna Anderson at [indiscernible] she threw out the idea. You got to really look at the utility industry we’re in their quality metric, there’s a significant penalty for an escape. So we’re really trying to look at how do we measure defect reduction, but also what if there’s any type of escape. Only one wouldn’t drive much in the metric, but it really should. So the answer your question is we’re changing it fundamentally, and we’re now making sure that what we put in place works well and drives the right kind of behavior.

Operator: Thank you. Due to time, our final caller comes from Peter Arment of Robert W. Baird.

Peter Arment: Yes, Mark, Pat, maybe just a quick one. I mean is there a timing when you expect to price the B-21 LRIP? And then just, Mark, if you could just give a little more color on the CH-53K program. I know you mentioned some of the forward losses there. Just what — any color in terms of the health of the program.

Pat Shanahan : Why don’t we switch? Why don’t you answer the [indiscernible] I’ll answer the 53.

Mark Suchinski: Absolutely. Yes. Thanks, Peter. On the B-21, we expect in the back half of this year to complete the negotiations in regards to the initial LRIP on that program. We’re on the tail end of the development side of the program, which is a cost-plus type arrangement and so we’ll be able to report back more on that later in the year. And obviously, when we think about our customers, our goal here is to sign up for contracts that add value to our company. And so that’s what our focus is going to be as we negotiate that contract later in the year.

Pat Shanahan : Yes, just maybe comment on the CH-53 program, we disappointed Stephanie Hill and our teammates at Lockheed Martin in ’23. We’re on track to turn that around in ’24, and it personally consumes my time every week, so we can deliver not only deliver on the airframes we’ve committed to, but also get to a higher production rate that supports the needs of the Marine Corps.

Operator: We have no further questions. And I would like to conclude the call here. Thank you all for joining and I can confirm the Spirit AeroSystems fourth quarter 2023 conference call has now concluded. And you may now disconnect your lines, and please enjoy the rest of your day.