Boeing, Adient shake up the aircraft seats market

Got seats?

For Boeing’s airline customers the airframer’s latest deal could help answer that question. Boeing is partnering with Germany’s Adient to form Adient Aerospace, a joint venture that will develop, manufacture, and sell a portfolio of seating products to airlines and aircraft leasing companies. The seats will be available for installation on new airplanes and as retrofit configurations for aircraft produced by Boeing and other commercial airplane manufacturers.

There are several reasons to justify Boeing‘s expansion into the seating market. The company (along with rival Airbus) has been hurt by delivery delays from various seat vendors over the years. Those delays mean aircraft cannot be delivered on time, affecting the company’s bottom line. Boeing also faces pressure from consolidation among its suppliers. In the past couple years a number of mergers brought increased negotiating power to the remaining vendors delivering the various components inside Boeing’s aircraft. Seating giant B/E Aerospace became a part of Rockwell Collins and then rolled into UTC over the past 18 months, for example. As the airframers work to push cost cuts down on to their suppliers the consolidation helps those vendors push back just a little bit.

“Adient has a strong set of transferable competencies that will offer a unique opportunity to create value for our company and for Boeing, our shareholders and the broader commercial aircraft market,” said Adient chairman and CEO Bruce McDonald. “To enhance the customer experience for passengers, airlines and commercial airplane manufacturers, we will apply our unmatched expertise for comfort and craftsmanship along with our reputation for operational excellence.”

Enter Adient Aerospace. The company is a giant in the automotive seat market. And if history is anything to go by that position should help it evolve well into the aerospace market as well. There are a number of similarities in the manufacturing process, scale and safety requirements involved across the two industries. Recaro has proven the crossover between the industries can work. Newcomer Mirus hopes to apply its motorsports background to aircraft seat manufacturing as well. Boeing and Adient hope to do the same.

“Seats have been a persistent challenge for our customers, the industry and Boeing, and we are taking action to help address constraints in the market. Adient Aerospace will leverage Boeing’s industry leadership and deep understanding of customer needs and technical requirements, to provide a superior seating product for airlines and passengers around the world,” said Kevin Schemm, senior vice president of Supply Chain Management, Finance & Business Operations and chief financial officer for Boeing Commercial Airplanes. “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.”

This is not the first partnership Boeing forged recently to help with the seating challenges. Just two years ago Boeing and LIFT by EnCore announced a partnership to deliver economy class seats for the 737 family of aircraft. The “Tourist Class Seating” product design leans heavily on the Boeing Sky Interior aesthetic while also delivering the comfort, reliability and delivery predictability Boeing and airlines demand. At that time the EnCore deal was also described as giving Boeing an “in-house” option for seats when smaller airline customers came shopping. The LIFT seats were still a 3rd party product but they would be a default, low cost option when airlines needed a solution and didn’t necessarily have the time or desire to negotiate with the larger vendors. The future value of that partnership is now somewhat up in the air as Boeing moves to have a true in-house seating arm in its portfolio.