Seating Strategy.jpg Nigel Howarth/AWST

Seating Strategy

Boeing and Adient deal is as much about maintaining seats as making them.

Boeing's move into the seat-production business will do more than remove uncertainty from its supply chain. It also places the OEM into another reliable aftermarket business—one that fits with its goal of driving its Boeing Global Services (BGS) expansion through organic growth.

The announcement that Boeing and automotive-seat specialist Adient will collaborate on a joint venture should give the OEM some protection against incumbent seat suppliers, notably Zodiac Aerospace, that have had problems delivering their products on time. This has resulted in Boeing (and others) failing to deliver some of their products—entire aircraft—on time.

While such challenges may have prompted Boeing to move now, the company clearly sees long-term benefit in being part-owner (49.99%, to be precise) of its own seat business. 

"This joint venture supports Boeing's vertical integration strategy to develop in-house capabilities and depth in key areas to offer better products, grow services and generate higher lifecycle value," says Kevin Schemm, Boeing Commercial's CFO and head of supply chain. 

Two other items from the announcement not to be overlooked: Boeing subsidiary Aviall will handle all spares distribution, and the venture plans to offer both forward-fit and retrofit programs for Boeing and non-Boeing aircraft. 

The aircraft-interiors business isn't easy. But it is lucrative. If Boeing and Adient deliver, Boeing's customers aren't the only ones that stand to benefit. BGS does, too. 

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