What happened

Shares of Spirit AeroSystems (SPR 6.00%) climbed more than 10% on Wednesday after the aerospace supplier announced a series of moves designed to help it weather the impact of the COVID-19 coronavirus pandemic. The one-time Boeing (BA 0.15%) subsidiary said it was suspending production on Boeing programs and cutting costs the best it can.

So what

Spirit AeroSystems has long tried to get out from under Boeing's shadow, but the company still relies on its former parent for more than two-thirds of revenue. With airlines grounding their fleets and cutting costs, Boeing has responded by halting production of new aircraft. That, in turn, is trickling down to suppliers like Spirit.

An aerospace assembly line.

Image source: Getty Images.

In a statement Wednesday, Spirit said it was halting production of most Boeing products and furloughing about 3,200 employees that work on those lines for 21 calendar days. The company said that defense work, as well as Airbus commercial work, would continue.

The shutdown is not good news, but investors knew it was coming. And Spirit AeroSystems was pretty upbeat in its statement about its cash position. The company said as of April 2 it has $1.83 billion in cash and $3.04 billion in debt on its balance sheet: "Spirit believes that it is well positioned to manage its liquidity through this challenging and unprecedented situation."

The company also said that if airplane production rates fall further, it would evaluate further cost reductions, "including additional workforce actions," as needed.

Now what

Spirit AeroSystems is doing what it can and should be commended. But make no mistake: This is a tough time to be a commercial aerospace supplier, and the ramifications from COVID-19 will be severe and long-lasting.

I believe the company is correct and is well-positioned to survive. But even so, this is a challenging time to be buying into the commercial aerospace supply chain. I'd recommend investors remain on the sidelines.