Boeing CEO to depart in shakeup of company's top leadership

Fallout from Jan. 5 door plug blowout

Boeing Co. chief executive David Calhoun will step down from the embattled plane maker at the end of the year as part of a broad management shakeup after a series of aircraft mishaps.

Stan Deal, CEO of Boeing's commercial airplanes unit, will retire immediately. Stephanie Pope, the company's chief operating officer for less than three months, has taken over leadership of the key division.

The company said board chair Lawrence Kellner, a former airline chief, won't stand for re-election in May and will be replaced by a former Qualcomm CEO.

Boeing has been under intense pressure since early January, when a panel blew off a brand-new Alaska Airlines 737 Max. Investigators say bolts that help keep the panel in place were missing after repair work at the Boeing factory.

The U.S. Federal Aviation Administration has stepped up its scrutiny of the firm, including putting a limit on production of 737s. An FAA audit of Boeing's 737 factory near Seattle gave the company failing grades on nearly three dozen aspects of production.

Airline executives have expressed their frustration with the company, and even minor incidents involving Boeing jets have attracted extra attention.

Fallout from the Jan. 5 blowout has raised scrutiny of Boeing to its highest level since two Boeing 737 Max jets crashed in 2018 in Indonesia and 2019 in Ethiopia. In all, the crashes killed 346 people.

Boeing's most significant effort to improve quality has been the opening of discussions about bringing Spirit AeroSystems, which builds fuselages for the Max and many parts for that and other Boeing planes, back into the company. Mistakes made at Spirit, which Boeing spun off nearly 20 years ago, have compounded the company's problems.

Calhoun said the decision to leave was his.

Cai von Rumohr, aerospace analyst at Cowen, said the management changes are “a partial step toward changing its culture to underscore safety and rebuild investor confidence in the company.”

Shares of Boeing Co. rose 1.4 per cent Monday.