Boeing CEO

Boeing CEO Dave Calhoun announced on March 25th that he will step down by the year’s end, according to Reuters.

The move comes as part of a broad management shakeup amid the aerospace manufacture’s ongoing safety crisis, exacerbated by the January 5th mid-air panel blowout on an Alaska Air 737 MAX plane.

A US National Transportation Safety Board report of the Alaska Air incident found that the panel blowout was caused in part because several bolts, intended to hold it in place, were removed and not replace. Upon investigation, there was no paperwork produced detailing what had happened to the bolts.

In addition to Calhoun, board chair Larry Kellner and the head of Boeing’s commercial planes department, Stan Deal, are also leaving as the iconic plane maker tries to tackle waning industry confidence due to myriad safety issues.

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Calhoun, 66, was brought in as Boeing’s CEO following two crashes in 2018 and 2019 that killed nearly 350 people.

Immediately after the January 5th incident, airline executives expressed support for Calhoun which ebbed after additional production delays, as-well-as quality problems at its key manufacturing hub outside Seattle, USA.

Boeing shares have lost roughly a quarter of their value since the incident, closing at 1.4% on March 25th.

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Senior portfolio manager at Dakota Wealth, Robert Pavlik, said “[Boeing] need more than just a shakeup at the CEO and the chairman of the board level… they’re just paralyzed from making decisions.”

The company is currently under federal investigation, with US authorities curbing production while Boing attempts to fix its safety and quality issues. It is also in talks with its former subsidiary Spirit AeroSystems in an attempt to get more control over its supply chain.

Michael O’Leary, head of top boing customer Ryanair, said his airline welcomed the “much-needed” management changes at Boeing.

Calhoun told CNBC that he made the decision to step down, and that he wanted to stay until the year’s end to address quality issues personally.

The company’s COO, Stephanie Pope has been appointed to lead Boeing Commercial Airplanes, made effective March 25th.

Steve Mollenkopf, former CEO of tech company Qualcomm has been appointed as the new chair of Boeing’s board and is leading the search for its next CEO. A source told Reuters that Mollenkopf will join Kellner in planned meetings with major US and foreign airline CEOs.

Some have suggested Spirit AeroSystems CEO Patrick Shanahan, a former Boeing executive and US government official now tasked with the company’s complex tie-up deal, was a potential successor to Calhoun.

Boeing spokesperson Joe Buccino said that Shanahan’s “sole priority remains building a culture of safety” in his time with Spirit AeroSystems.

Reuters / CNBC

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