His departure comes as Boeing faces more stringent oversight from federal regulators amid a series of quality and manufacturing issues
Boeing $BA CEO Dave Calhoun will step down from the aerospace giant by the end of 2024, the company said Monday, as Boeing navigates the fallout from a near-disastrous incident involving a 737 Max jet earlier this year and other safety issues it revealed.
The company said in a statement that Calhoun will be joined by Boeing Commercial Airplanes CEO Stan Deal, who is also leaving the Arlington, Virginia-based company. Larry Kellner, the chairman of Boeing’s board of directors, is also resigning and will leave the board at the company’s annual meeting in May.
The string of high-profile departures comes as Boeing faces more stringent oversight from federal regulators after a series of quality and manufacturing flaws were discovered on Boeing’s planes. Boeing’s rough 2024 started on Jan. 5, when a door plug blew out of a 737 Max 9 jet minutes into an Alaska Airlines flight.
“As you all know, the Alaska Airlines Flight 1282 accident was a watershed moment for Boeing,” Calhoun wrote in a letter to staff. “We must continue to respond to this accident with humility and complete transparency. We also must inculcate a total commitment to safety and quality at every level of our company.”
“The eyes of the world are on us, and I know we will come through this moment a better company, building on all the learnings we accumulated as we worked together to rebuild Boeing over the last number of years,” he added.
Boeing stock was essentially flat in Monday morning trading following a brief bump after the departures were announced. The company’s shares have dropped 27% in 2024, making it one of the worst-performing stocks in the S&P 500.
Calhoun, previously a decade-long member of the Boeing board, was named CEO in late 2019. He replaced Dennis Muilenburg, who himself resigned on the heels of a previous 737 Max crisis. In 2018, a Lion Air 737 Max 8 flight crashed in Indonesia, killing 189 people. An Ethiopian Airlines 737 Max 8 plane crashed a few months later, killing 157 people. The 737 Max 8 was grounded for 20 months as regulators sorted out issues with its safety systems.
“The board of directors decided that a change in leadership was necessary to restore confidence in the company moving forward as it works to repair relationships with regulators, customers, and all other stakeholders,” Boeing said in a statement at the time.
Boeing COO Stephanie Pope — who stepped into that role on Jan. 1 after leading Boeing Global Services — will succeed Deal as the head of Boeing Commercial Airplanes the company said. Pope has previously been the commercial unit’s chief financial officer.
Kellner will be succeeded by former Qualcomm $QCOM CEO Steve Mokkenkopf as the board’s chairman. Mokkenkopf will lead the board in selecting Calhoun’s successor.
“I am fully confident in this company and its leadership — and together we are committed to taking the right actions to strengthen safety and quality, and to meet the needs of our customers,” Mokkenkopf said in a statement.
In the wake of the Jan. 5 incident, the National Transportation Safety Board and the Federal Aviation Administration launched investigations into how it occurred, with the latter agency increasing oversight of Boeing. The Justice Department reportedly began a criminal inquiry earlier this month. And on Friday, the FBI informed passengers that the incident might have been a crime of which they would be considered victims.
With the heightened scrutiny, Boeing has been forced to slow down production of new jets, irritating airline CEOs — several of whom expressed their frustration earlier this month while speaking at a conference in New York. Last week, several airline CEOs began scheduling meetings with Boeing directors — including Kellner — to address production problems.
Boeing and Alaska are facing multiple lawsuits over the January flight. Twenty-two passengers who were aboard the Alaska Airlines flight filed a class-action lawsuit against the companies earlier this year. And on March 4, three passengers filed a separate lawsuit seeking $1 billion in damages.
The Financial Times reports that the union representing 32,000 Boeing workers in Washington state, which began contract negotiations with the company earlier this month, is seeking a seat on Boeing’s board.
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