Boeing CEO Dave Calhoun, along with Larry Kellner, chairman of the board, are stepping down from their positions by the end of 2024. This decision is part of a broader management shake-up for the embattled aerospace giant. Steve Mollenkopf, a Boeing director since 2020 and former CEO of Qualcomm, will succeed Kellner as chairman and lead the board in choosing a new CEO. Additionally, Stan Deal, president and CEO of Boeing Commercial Airplanes, is leaving the company immediately, with Stephanie Pope taking over his role after recently becoming Boeing’s chief operating officer.
The departures at Boeing come as airlines and regulators are calling for major changes at the company in response to a series of quality and manufacturing flaws on Boeing planes. Scrutiny intensified after an incident on Jan. 5, when a door plug blew out of a nearly new Boeing 737 Max just 9 minutes into an Alaska Airlines flight. Calhoun, in a message to employees, emphasized the need for humility, transparency, and a commitment to safety and quality at every level of the company. He expressed confidence that Boeing will emerge from this challenging period as a better company.
Calhoun spoke to CNBC about his decision to resign, attributing it to the need for the company to address the challenges it faces and make necessary changes within its factories and supply chain. He was appointed CEO in late 2019 and took over in early 2020 following the ousting of the previous chief executive, Dennis Muilenburg, due to his handling of the aftermath of two deadly 737 Max crashes. Calhoun has been working to address Boeing’s quality struggles and repair the company’s reputation with investors, airline customers, and the public.
The Federal Aviation Administration has increased oversight of Boeing, and agency Administrator Mike Whitaker has indicated that Boeing will not be allowed to increase 737 production until the FAA is satisfied with the company’s quality control. Production problems at Boeing have resulted in delayed deliveries of new planes, causing frustration among the company’s largest customers, including United Airlines, Southwest Airlines, American Airlines, and Ryanair. Boeing’s stock has declined significantly this year, and the company’s financial performance has been impacted by limited 737 Max production.
Ryanair CEO Michael O’Leary welcomed the management changes at Boeing, expressing confidence that the new leadership can address the operational challenges facing the company. United Airlines CEO Scott Kirby has raised concerns about the production of yet-to-be-certified Max 10 planes, urging Boeing to provide clarity on when these aircraft will be cleared to fly. Airline CEOs have been meeting with Boeing directors to voice their dissatisfaction with manufacturing quality controls and production issues. Boeing CFO Brian West recently announced that the company would burn more cash than expected due to lower 737 Max production levels. Despite these challenges, Boeing’s stock saw a slight increase following Calhoun’s announcement of his resignation.
