Eleven weeks after the January 5 panel blowout on an Alaska Airline flight that sharply put into focus the safety and security issues at Boeing, the Seattle-based plane manufacturer will lose its CEO Dave Calhoun as an aftermath.
The 66-year-old Calhoun was brought in as CEO following a pair of crashes in 2018 and 2019 that killed nearly 350 people.
The 171 passengers and six crew members of Flight 1282 miraculously survived, but the incident led to a serious lack of confidence in Boeing’s safety procedures and hampered its ability to increase production because of regulatory concerns.
Also going out is Stan Deal, the CEO of the Boeing Commercial Airplanes unit in charge of production in the Renton and Everett assembly plants. He’s retiring from the company. Larry Kellner, Boeing board member for 13 years and chair since 2019, announced he won’t stand for re-election at the company’s annual meeting in May.
Steve Mollenkopf, former Qualcomm CEO who was appointed to the board of directors in 2020, will replace Kellner immediately as board chair and lead the search for Boeing’s new CEO.
The news of Calhoun’s departure was greeted by Wall Street. Boeing’s shares closed at $191.4, up 1.4 per cent, but still massively down from a 52-week high of $267.54.
In a letter to Boeing employees on Monday, Calhoun wrote: “As you all know, the Alaska Airlines Flight 1282 accident was a watershed moment for Boeing. 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.”
Calhoun also said he made the decision to step down.
Speaking to CNBC, he said: “It was me giving them notice that at the end of this year I plan to retire.
“We have another mountain to climb. Let’s not avoid the call for action. Let’s not avoid the changes that we have to make in our factory. Let’s not avoid the need to slow down a bit and let the supply chain catch up.”
Some investors said the shake-up would not be enough to address these persistent issues, but Michael O’Leary, head of Ireland’s Ryanair, a top Boeing customer, said Monday the airline welcomed the “much-needed” management changes at Boeing.
In a social media video post on X, O’Leary said: “Stan Deal has done a great sales job for Boeing for many years. But he’s not the person to turn around the operation in Seattle and that’s where most of the problems have been in recent years.”
A US National Transportation Safety Board report of the Alaska Air incident found that the panel blowout was caused in part because several bolts meant to hold the plug in place were removed and not replaced – and there was no paperwork detailing what happened to those bolts. The head of the NTSB said in early March that the company had not provided records the agency had requested.
Following the incident, the FAA curbed Boeing’s production to 38 jets per month.
The board’s letting Calhoun stay until year-end suggests its members continue to have some faith in him and in the major changes he’s got underway.
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