Honeywell Aerospace CEO says firm acted “too late” on supplier strain that forced guidance cut
Honeywell Aerospace CEO says firm acted “too late” on supplier strain that forced guidance cut
Honeywell Aerospace chief executive Jim Currier has acknowledged that the company moved too slowly to address supplier bottlenecks as demand surged after the pandemic, comments that shed light on why the newly independent aerospace group scaled back its 2026 financial projections last month.
Speaking at a Jefferies investor conference on 9 September, Currier said bearings and machined, cast and forged metallic components are the categories most holding up production. “We were a little late in pivoting the organisation, as part of the conglomerate, to be able to capture that demand we were seeing coming out of the pandemic,” he said.
Currier stressed that the supplier difficulties have not damaged the company’s competitive position, saying the order book and product portfolio have not eroded despite the delays.
The remarks come roughly two months after former parent Honeywell completed the spin-off of Honeywell Aerospace on 29 June. Ahead of the separation, executives had projected a $4.65–4.75 billion adjusted profit for 2026 on sales growth of 7–9%. On 6 August, the company revised that outlook to a $4.35–4.45 billion adjusted profit and 4–5% sales growth, saying it had underestimated the scope of its supply chain problems.
Roots in a leaner, outsourced supply base
Currier traced the issues to decisions made between 2010 and 2019, when the aerospace business, then part of the conglomerate, moved away from vertical integration and consolidated toward single suppliers for many parts in pursuit of efficiency amid soft demand. “We were outsourcing a lot of the core competencies,” he said.
When demand rebounded strongly after Covid-19, some suppliers struggled to scale. Of the company’s roughly 3,000 suppliers, Currier said 70 are still failing to meet requirements, with 10 classified as “constrained” — not delivering to plan or growing at needed rates, and effectively acting as bottlenecks. Bearing suppliers are the most troubled, running “well below plan,” according to the company.
Currier cited poor planning, skilled labour and raw material shortages, reduced vertical integration, outdated tooling and insufficient investment as contributing factors. Since becoming CEO in 2023, he said he has redirected the company to address the issues, including through a $1 billion investment in the supply base and the addition of new suppliers.
Shares of Honeywell, the former parent, closed at $206.54, down about 1.0% on the day, with a market capitalisation of roughly $65.5 billion.
What to watch
- Progress updates on the 10 “constrained” suppliers, particularly bearing output
- Whether the revised 2026 guidance of 4–5% sales growth holds at upcoming earnings reports
- Details on deployment of the $1 billion supply base investment
- Order book trends following the June spin-off as the company operates independently
Source: original release