Boeing may turn to outsider CEO
New head will face big task in tackling spiralling crisis
NEW YORK: Boeing’s board has begun the search for a big-hitter to take the helm of the troubled planemaker following the turbulent tenure of chief executive officer Dave Calhoun, with many industry executives and analysts predicting it will seek an outside remedy.
Facing mounting pressure from airlines, regulators and investors, Boeing on Monday announced a broader than expected shake-up with Calhoun, 66, stepping down by year-end on the heels of the company’s commercial planemaking chief and its chairman.
The US planemaker has been wrestling with a growing crisis following a January mid-air panel blowout on a 737 MAX plane.
The new CEO will face numerous tasks, including improving the company’s safety culture, addressing quality issues and regaining the trust of regulators, customers and the public.
Boeing will also have to deliver on goals to ramp up production and boost cashflow as it tries to reduce debt and make up ground against European rival Airbus.
Just three months ago, Boeing appeared to anoint Stephanie Pope as a future leader after naming her chief operating officer following a successful stint running its services division.
But on Monday, Pope was named head of Boeing’s commercial aeroplanes division, replacing Stan Deal who retired, with responsibilities including the MAX factory.
Her new position makes a move into the top job less likely, at least for now, analysts said.
“The company was teeing up Stephanie Pope to likely succeed Calhoun but that seems to have changed in favour of an external search for a new CEO,” Stifel analyst Bert Subin said.
Many investors say GE CEO Larry Culp has the star quality Boeing desperately needs to rebuild confidence, having split the historic conglomerate into three public companies.
But Culp recently told reporters he was fully focused on leading GE Aerospace as a standalone engine maker, and that he looked forward to continuing to serve Boeing as a key partner and supplier. GE is due to complete the split next week. Pat Shanahan, an ex-boeing executive and once acting US defence secretary in the Trump administration who now heads struggling MAX fuselage supplier Spirit Aerosystems, is also cited as a possible frontrunner. Shanahan could be elevated once the planemaker completes talks to buy Spirit, which was a Boeing subsidiary until 2005.
“He is the perfect outsider; he knows Boeing inside and out, and now knows the people who produce fuselages and who look like they will be part of Boeing again,” said industry veteran Adam Pilarski, who in January questioned how long Calhoun could last.
Shanahan might not want to commit to five years at Boeing, said a former company executive who worked with the former Boeing production chief. “This is an endurance game,” said the executive, speaking on condition of anonymity.