“Boeing’s Leadership Overhaul: Chairman and CEO Among Those Sacked”
The leadership shakeup at Boeing continues as both the Chairman and CEO face the consequences of a series of scandals. This comprehensive management reorganization comes during a challenging period for the aerospace giant.
Changes at the Top
Boeing’s CEO, Dave Calhoun, will step down at the end of 2024, according to CNBC. This announcement is part of the company’s extensive management overhaul amid difficulties faced by the aerospace industry.
In addition, Larry Kellner, the Chairman of the Board, will also step down and not seek re-election at Boeing’s annual meeting in May. He will be replaced by Steve Mollenkopf, who has been serving as the director of Boeing since 2020 and will lead the board in selecting a new CEO, as indicated by Boeing.
Furthermore, Stan Deal, the President and CEO of Boeing Commercial Airplanes, will also leave the company immediately. Stephanie Pope will assume his position as the new CEO of Boeing. Pope previously held a management role at Boeing Global Services.
Departures Amidst Controversy
Several Boeing executives are leaving the company amidst increased scrutiny from airlines and regulatory agencies. These departures follow a series of misconduct issues that have led to a decline in the quality of Boeing aircraft.
The oversight of Boeing’s operations has been strengthened since the incident on January 5th, when a door opened on an Alaska Airlines’ nearly new Boeing 737 Max just nine minutes into its flight.
“Everyone knows that Alaska Airlines flight 1282 was a turning point for Boeing,” stated Calhoun in his address to employees. “We must continue to respond to this incident with humility and transparency. We must also make a comprehensive commitment to safety and quality at all levels of the company.”
Calhoun confirmed in an interview with CNBC that the decision to step down was entirely his own.
Calhoun was named CEO at the end of 2019 and assumed leadership of Boeing at the beginning of 2020, following the dismissal of former CEO Dennis Muilenburg due to his handling of the aftermath of two 737 Max plane crashes that resulted in hundreds of fatalities.
In recent months, Calhoun has assured investors, airlines, and the public that Boeing would address its quality issues. Following the Alaska Airlines incident, the Federal Aviation Administration (FAA) enhanced its oversight of Boeing, and Mike Whitaker, the FAA’s manager, confirmed that Boeing would be prohibited from increasing the production of 737 aircraft until the FAA is satisfied with the company’s quality control.
Boeing’s production issues have caused delays in delivering new planes to customers, hampering growth plans. The CEOs of major Boeing customers, including United Airlines, Southwest Airlines, and American Airlines, have voiced their dissatisfaction with the production quality control and lower-than-expected output of the 737 Max aircraft.
Last week, airline CEOs scheduled meetings with Boeing’s directors to express their discontent with the lack of quality control in production and the lower-than-planned 737 Max output. These meetings involved Kellner and other members of the Board of Directors.
Additionally, at an industry conference, Boeing’s Chief Financial Officer, Brian West, revealed that the company would burn more cash than expected due to limited production of the 737 Max aircraft.
As of the market close on March 22nd, Boeing’s stock has declined by 27% this year.
Business Today will continue to monitor the developments at Boeing as the company strives to rebuild its reputation and regain its standing in the industry.