As Boeing looks to buy a key 737 supplier, a whistleblower says the problems run deep

WICHITA, Kan. — For most of his career at Spirit AeroSystems, Santiago Paredes worked at the end of the line. It was his job to catch production errors before the fuselage left the factory in Wichita, and Paredes caught a lot of them.

“It’s poor quality. Poor quality of work, just plain and simple,” he says, flipping through photos on his phone of the serious mistakes that he flagged during his dozen years as a quality inspector at Spirit.

Boeing is trying to rebuild its battered reputation for quality after a door plug blowout on a 737 Max in midair last January. The troubled plane-maker is in talks to buy Spirit AeroSystems, a key supplier that makes the fuselage for Boeing in Wichita, Kan.

But Paredes is skeptical. He warns that the problems at Spirit run deep, and he says he wasn’t surprised by the door plug blowout.

“It was just a matter of time,” Paredes said, before a serious defect escaped from the factory.

The door plug blowout brought a whole new level of scrutiny to Boeing and Spirit. Federal regulators believe that four key bolts were missing when the plane left Boeing’s factory. But the door plug had to be reopened in the first place so that workers could repair damaged rivets that were installed at Spirit’s factory in Wichita.

Since then, the two companies have scrambled to improve their manufacturing quality and rebuild the trust of federal regulators and the flying public. As part of that effort, Boeing is in talks to buy Spirit.

Boeing changes its strategy

“We believe, and Spirit believes, that reintegrating these two companies is what's best for safety and for quality for the aerospace industry,” Boeing’s Chief Financial Officer Brian West said at an investor conference in March.

This is a dramatic reversal for Boeing. Nearly 20 years ago, the company sold its fuselage factory in Wichita, which then became part of Spirit. Now Boeing’s leaders say the company might have taken outsourcing too far, and they want that factory back.

“It's really about focus and running that business, not as a business, but as a factory,” West said. “Run it as a factory and stay focused on safety and quality and stability.”

Spirit has made changes, too. The company fired its CEO last fall after a series of expensive and embarrassing quality lapses and brought in Patrick Shanahan, a former Boeing executive. The two companies have made big shifts in how they inspect fuselages, Shanahan says, and where they do any repair work that’s necessary.

“The big step function of realigning the two companies and where the work is done I think is behind us,” Shanahan said on an earnings call last month. “The benefits in the short term have been we've seen about a 15% improvement in quality.”

But not everyone is convinced that the problems at Spirit will be that easy to fix.

“They say the correct things like they've always said,” said whistleblower Santiago Paredes. “But I know how they really are.”

A clash with management

Paredes says he brought his concerns to his managers repeatedly. But they were more worried about getting fuselages out of the factory faster to keep up with Boeing’s backlog.

“They were upset for me finding defects,” Paredes said. “It was never the people that created the defects fault. It was my fault for finding it.”

It got to the point, Paredes says, that a manager ordered him in writing to essentially undercount the number of mistakes.

“They wanted me to basically falsify the documentation on the amount of defects that were being found,” Paredes said. “They were telling me to lie.”

Paredes was demoted — in retaliation, he says, for pushing back on his managers. He did eventually get his job back, but it took a lengthy battle and a direct appeal to the former CEO.

Two years ago, Paredes left Spirit for another job in the industry and moved away from Wichita. And he detailed his allegations anonymously in a shareholder lawsuit alleging “excessive” defects in the factory.

Spirit is fighting that lawsuit in court.

"We strongly urge anyone at Spirit with concerns about any aspect of our operations to speak up, safe in the knowledge that they will be protected," said Spirit spokesman Joe Buccino.

Paredes says the top leadership at Spirit may have changed, but he says many of the managers he clashed with are still there. And until they’re gone, he doesn’t think the culture at Spirit will truly change, either.

“They hated me,” he said. “They thought I was trying to make them look bad. But I wasn't. I was just trying to push a quality product out.”