BOEING, GOING , GONE
Embattled CEO, other top execs are exiting
Boeing CEO Dave Calhoun pulled the ripcord on his turbulent tenure Monday, setting off a succession battle as the aerospace giant grapples with a string of problems including a midair door-plug blowout on a 737 MAX 9 on Jan. 5.
Calhoun said he will step down at the end of the year amid a wider shake-up that also includes the company’s chairman, Larry Kellner, who will exit the board of directors in May, and Stan Deal, president and CEO of Boeing Commercial Airplanes, who is resigning immediately.
Steve Mollenkopf, former CEO of tech giant Qualcomm, will be Boeing’s new chairman and will oversee the search for a new CEO.
The list of candidates is expected to include Stephanie Pope, Boeing’s COO and three-decade veteran, who stepped into Deal’s role Monday.
Others floated by Wall Street analysts were Mollenkopf himself and Pat Shanahan, deputy defense secretary under Donald Trump, who took over as CEO of Spirit AeroSystems last year, The Wall Street Journal reported.
‘Problems systemic’
However, Shanahan’s ascent could face difficulty, considering his company was the parts supplier behind the door-plug near-disaster in January that resulted in an emergency landing and led to safety scrutiny by the feds.
“They need more than just a shake-up at the CEO and the chairman of the board level . . . they’re just paralyzed from making decisions,” said Robert Pavlik, senior portfolio manager at Dakota
Wealth.
“The problems in Boeing’s executive suite are systemic. Nothing is going to change for the better without company leadership acknowledging their failures and thoroughly committing to fixing them,” added Ray Goforth, executive director of the Society of Professional Engineering Employees in Aerospace, which represents more than 19,000 workers at Boeing and Spirit AeroSystems.
News of the leadership overhaul was positively received by Ryanair CEO Michael O’Leary, who said he “welcomed these much-needed management changes.”
Ryanair was one of several carriers that had to cut flights as a result of safety inspections that were carried out in the wake of the doorplug incident.
Boeing’s stock, which has fallen by some 25% since the start of the year, was up 1.36% Monday.
Last week, the Journal reported that a group of CEOs from major US airlines requested a meeting with Boeing’s board to express concerns over production problems.
Calhoun, who fought back tears while “acknowledging our mistake” during his announcement, reportedly encouraged the meetings between the CEOs and the board.
On Jan. 5, the rear door plug of a Boeing 737 MAX 9 passenger plane operated by Alaska Airlines blew out in mid-flight, resulting in the FAA ordering the grounding of the model for weeks.
In late January, the FAA gave the green light for the MAX 9s to be put back into service.
Last month, the National Transportation Safety Board issued initial findings of their investigation which concluded that bolts that held the door plug in place were missing from the jet.