Adient and Boeing expect to create additional value for customers in the aircraft industry
Addressing the needs for superior comfort, craftsmanship and operational excellence, creating additional capacity and improved on-time performance: the new proposed joint venture between Adient and Boeing, Adient Aerospace, will add value to the industry.
HAMBURG April 10, 2018 – Adient [NYSE: ADNT] and Boeing [NYSE: BA] are showcasing a portfolio of jointly developed lie-flat business class seat prototypes to potential customers at the Aircraft Interiors Expo in Hamburg, Germany. The companies intend to contribute those prototypes to Adient Aerospace, the joint venture that Adient and Boeing are planning to establish to develop, manufacture, and sell a portfolio of seating products to airlines and aircraft leasing companies.
“It will be our goal to provide a superior customer and passenger experience by delivering superior quality seats with intelligent product design,” said Alan Wittman, nominated CEO of Adient Aerospace. “In addition to expanding seating choices and adding manufacturing capacity to address broader commercial airplane industry needs, we are focusing on comfort, craftsmanship and operational excellence to differentiate our future products and services.”
Adient Aerospace will bring together two leaders in their respective industries: Adient, the global leader in automotive seating, will leverage its unmatched expertise in comfort, craftsmanship and operational excellence. Boeing, the world’s largest aerospace company, will contribute its deep understanding of aerospace requirements and customer expectations. Adient Aerospace will also benefit from the world-class engineering teams and innovative cultures at both companies, as well as shared expertise in managing complex, global supply chains.
“Adient, with its global automotive competencies, delivering more than 25 million seats to the automotive industry every year, will help to create a compelling new choice for customers,” said Jason Fahlbush, nominated COO of Adient Aerospace. “Adient is also looking for opportunities to grow, diversify its business, and at ways to use transferable capabilities beyond our core automotive business.”
The joint venture will focus on providing innovative seating solutions, future design concepts and layout of passenger accommodations (LOPA) strategies for airlines, aircraft leasing companies and passengers around the world. The seats will be offered for installation on new airplanes and as retrofit configurations for aircraft produced by Boeing and other commercial airplane manufacturers.
Adient Aerospace will address the profitable commercial airline seating market, which industry analysts expect to grow from approximately $4.5 billion in 2017 to $6 billion by 2026.
The initial product development is expected to take place in Kaiserslautern, Germany, near Frankfurt. The joint venture’s initial customer service center will be based in Seattle, Washington, capitalizing on the constant flow of airlines and airplane leasing companies visiting the region. The aftermarket spare parts distribution will be performed exclusively through Aviall, a wholly owned subsidiary of Boeing.
Adient will be the majority stakeholder in the new company (50.01 percent share) and expects the joint venture to be included in its consolidated financial statements. Boeing (as 49.99 percent partner) will receive a proportionate share of the earnings and cash flow. Both will have representation on Adient Aerospace’s board of directors.
In January 2018, Adient and Boeing announced their intent to form Adient Aerospace. The establishment of the joint venture is subject to customary regulatory approvals.
Adient is the global leader in automotive seating. With 85,000 employees operating 238 manufacturing/assembly plants in 34 countries worldwide, we produce and deliver automotive seating for all vehicle classes and all major OEMs. From complete seating systems to individual components, our expertise spans every step of the automotive seat making process. Our integrated, in-house skills allow us to take our products from research and design all the way to engineering and manufacturing – and into more than 25 million vehicles every year. For more information on Adient, please visit adient.com.
Boeing is the world’s largest aerospace company and leading manufacturer of commercial airplanes and defense, space and security systems. Boeing is also the world leader in combined commercial airlines and government services with customers in more than 150 countries. The company’s products and tailored services include commercial and military aircraft, satellites, weapons, electronic and defense systems, launch systems, advanced information and communication systems, and performance-based logistics and training. Boeing employs approximately 140,000 people across the United States and in more than 65 countries. Company revenues for 2016 were $94.6 billion.
Cautionary Statement Regarding Forward-Looking Statements:
Adient and Boeing have each made statements in this document that are forward-looking and, therefore, are subject to risks and uncertainties. All statements in this document other than statements of historical fact are statements that are, or could be, deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. In this document, statements regarding Adient’s and Boeing’s future financial position, sales, costs, earnings, cash flows, other measures of results of operations, capital expenditures or debt levels and plans, objectives, outlook, targets, guidance or goals are forward-looking statements. Words such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “should,” “forecast,” “project” or “plan” or terms of similar meaning are also generally intended to identify forward-looking statements. Adient and Boeing each caution that these statements are subject to numerous important risks, uncertainties, assumptions and other factors, some of which are beyond their control, that could cause their actual results to differ materially from those expressed or implied by such forward-looking statements, including, among others, risks related to: the ability of Adient Aerospace to successfully implement its strategic initiatives or realize the expected benefits of the joint venture, the ability of Adient or Boeing to meet debt service requirements, the ability and terms of financing, general economic and business conditions, the strength of the U.S. or other economies, automotive vehicle or aircraft production levels, mix and schedules, energy and commodity prices, the availability of raw materials and component products, currency exchange rates, the ability of Adient to effectively integrate the Futuris business, and cancellation of or changes to commercial arrangements. A detailed discussion of risks related to Adient’s business is included in the section entitled “Risk Factors” in Adient’s Annual Report on Form 10-K for the fiscal year ended September 30, 2017 filed with the SEC on November 22, 2017 and quarterly reports on Form 10-Q filed with the SEC, available at www.sec.gov. Potential investors and others should consider these factors in evaluating the forward-looking statements and should not place undue reliance on such statements. The forward-looking statements included in this document are made only as of the date of this document, unless otherwise specified, and, except as required by law, Adient and Boeing assume no obligation, and disclaims any obligation, to update such statements to reflect events or circumstances occurring after the date of this document.
In addition, this document includes certain projections provided by Adient and Boeing with respect to the anticipated future performance of their respective businesses. Such projections reflect various assumptions of each company’s management concerning the future performance of its businesses, which may or may not prove to be correct. The actual results may vary from the anticipated results and such variations may be material. Neither Adient nor Boeing undertake any obligation to update the projections to reflect events or circumstances or changes in expectations after the date of this document or to reflect the occurrence of subsequent events. No representations or warranties are made as to the accuracy or reasonableness of such assumptions or the projections based thereon.