Boeing Approval and Expanded Long Term Agreement
Velocity Composites plc is pleased to announce that it has received approval from Boeing to supply structural composite material kits for Boeing’s single isle narrow body jet platform (the “Boeing Approval Certificate”). This approved status follows 18 months of preparation, planning and audit, involving the Company, Boeing and the Tier 1 advanced aerostructure manufacturer through whom the Boeing contract is managed (the “Customer”). The receipt of Boeing’s approval will form a key element in the Company’s future growth strategy.
The Company announced on 1 June 2018 that it had entered into a Long Term Agreement to supply complex design kits for the Boeing 737 Max programme. Following receipt of the Boeing Approval Certificate, the Company is pleased to announce that the Long Term Agreement has now been expanded to include the supply of structural composite material kits for Boeing’s single aisle narrow body jet platform, the 737 Max (the “Agreement”).
Velocity has been supplying the Customer with highly complex process material kits and vacuum bags for the 737 Max for approximately two years. The new Agreement secures sales of structural composite material kits for this platform, in line with the production programme rate going forward and for the duration of the Customer’s contract with the ultimate OEM.
The Agreement includes the provision of a full Velocity managed service from a forward stocking location based at the Customer’s site. This new service offering is a key pillar in the Group’s growth strategy to grow customers and service facilities. The Board believes that being in close proximity to customers will create significant new business opportunities for the Group.
Velocity is now producing its First Article Inspection (FAI) products in respect of structural material kits for the platform under the Agreement and expects to supply these for Customer approval by the end of January 2020, after which the Group will be in a position to meet the Customer’s demand going forward.
Jon Bridges, CEO of Velocity, said:
“We are absolutely delighted to have secured approval from Boeing for our structural material kits and to have extended the substantial contract with an important customer. Velocity will now be supplying all its materials for the Boeing 737 Max programme in value-engineered kit form. This is the culmination of close, multi-functional cooperation from all parties and working together with the Customer to remove waste from the composite material supply and production process.
“This award strengthens the Group’s catalogue of regulatory and industry qualifications and approvals, which includes Airbus and several Tier 1 aerostructure manufacturers, and fulfils key elements of our strategy, to grow customers and sites, to expand our approvals and increase the use of composites in aircraft manufacture.”