Boeing said on Monday it would reshuffle its leadership amid its most significant safety crisis, announcing sweeping changes that include the departure of its chief executive, Dave Calhoun, at the end of the year.
The planemaker has come under increasing pressure from regulators, airlines and passengers as the company struggles to respond to the fallout from an Alaska Airlines flight in early January when a crew knocked a Boeing 737 Max 9 out of midair.
The incident casts the company as a prestigious American company and renewed concerns about its commitment to safety and quality five years after two crashes of 737 Max 8 planes killed a total of 350 people.
Mr. In addition to Calhoun's departure, Stan Diehl, head of the division that makes planes for airlines and other commercial customers, will retire immediately. He will be replaced by Boeing Chief Operating Officer Stephanie Pope said in a statement.
Boeing also announced that CEO Larry Kellner will not run for re-election. The board selected Steve Mollenkopf, an electrical engineer by training and former Qualcomm chief executive, as its new chairman. In that role, he will lead the process of selecting Boeing's next chief executive.
The Federal Aviation Administration, which regulates the plane maker, grounded 737 Max 9 planes across the US after the Alaska Airlines incident. When the agency allowed the planes to fly again in late January, it also put limits on Boeing's planned production ramp-up of MAX planes, thwarting the company's latest bid to better compete with its European rival Airbus.
A recent FAA audit of Boeing's Max product found dozens of defects. The agency gave Boeing 90 days to resolve its issues. The Department of Justice has reached out to Alaska Airlines passengers and informed them they may be “victims of a crime,” according to a copy of such notice.
After the incident, airline executives publicly expressed frustration with the manufacturer. The chief executives of several major carriers in the U.S. said this week that Mr. Kellner and other board members are set to meet, a person familiar with the plans said. Mr. Calhoun supported the meetings but would not attend them. Mr. Mollenkopf will now participate.
In a memo to employees announcing the leadership changes on Monday, Mr. Calhoun said.
“The eyes of the world are on us, and as we've worked together over the past several years to rebuild Boeing, I know we'll build on all the learnings we've gathered and create a better company this time around,” he said.
Discussions about a change in the company's leadership have been going on for some time. At the end of last yearThe company appointed Ms. Pope as its chief operating officer, who in a few years succeeded Mr. He was thought to have been set up to take over for Calhoun.
Ms Pope has seen a relatively rapid rise in recent years. In early 2022, he was promoted to head of Boeing Global Services, providing aftermarket support to customers, from chief financial officer of the commercial aircraft division.
Mr. Calhoun said in an interview with CNBC that he will be part of the search for his successor. He characterized all leadership changes, including his own, as “very deliberate.”
“Why now? I have entered the fifth year,'' he said. “At the end of this year, I will be 68 years old. I've always told the board — and the board is very willing — that I'll give them plenty of notice so they can understand and plan for succession.
Monday's announcement came ahead of the company's annual meeting expected in May, during which board members will be elected.
His predecessor, Dennis A., who led the company during the 2018 and 2019 crashes. After firing Muilenburg, Boeing's board appointed Mr. Appointed Calhoun as chief executive. Taking over the leadership of the company in January 2020, Mr. Calhoun has been a member of the manufacturer's team since 2009. He spent most of his career at General Electric, where he was once a vice president and head of the company's infrastructure division.
Boeing's board has raised the mandatory retirement age of the chief executive from 65 to 70 in 2021, and until April 2028, Mr. Calhoun's departure was more surprising since he was allowed to remain on the job.
The leadership shakeup raises pressing questions about Boeing's succession planning. Ms. Pope now has a big job fixing up the business aviation division. Analysts have said the company could bring in a top executive from outside, but the number of experienced people needed to lead an engineering and manufacturing company with more than 170,000 employees is very limited.
Since the door plug incident in January, Mr. Calhoun has confirmed it over and over again. But the pressure on him and Boeing continued to mount. The National Transportation Safety Board's preliminary report on the incident said four bolts that were supposed to hold the door in place before exiting the plane were missing. The bolts were removed at the Boeing factory in Renton, where the 77 Max was built, so that the damaged rivets could be repaired.
The company announced in February that the head of its 737 Max program was leaving the company, doing little to address the growing criticism. Even some travelers are wary of the company's most popular series, the 737 Max. After the Alaska Airlines crash, flight booking service Kayak said it saw a significant uptick in users searching for scheduled flights on 737 Max planes.
A union leader representing more than 19,000 engineers, scientists, pilots and other employees at Boeing and its supplier Spirit Aerosystems said the planemaker's management must make sweeping changes to regain its credibility.
“The problems with Boeing's executive suite are legitimate,” union president Ray Goforth, executive director of the Association of Professional Engineering Employees in Aerospace, said in a statement. “Nothing is going to get better until corporate leadership acknowledges their failures and fully commits to correcting them.”
Southwest Airlines, a major Boeing customer that only flies the company's planes, said in a statement that it is “committed to working with Boeing's new leadership team to ensure that every aircraft meets the highest quality and safety standards.” Delta Airlines and United Airlines issued similar statements.
Shares of Boeing rose about 1 percent on Monday morning, after the company announced its management changes.
