Boeing has implemented a broad management shake up that will see chief executive David Calhoun leave the company at the end of 2024 and that includes the immediate retirement of Boeing Commercial Airplanes boss Stan Deal.
Chief operating officer Stephanie Pope is now leading Boeing Commercial Airplanes. Additionally, Steve Mollenkopf has replaced Larry Kellner as chair of Boeing’s board of directors, effective immediately, Boeing said on 25 March.
The moves come as the company faces heightened regulatory scrutiny and intense pressure from airline customers, many of whom have become increasingly frustrated with Boeing’s quality and manufacturing problems.
Boeing’s board of directors has not yet identified Calhoun’s successor as chief executive, saying new board chair Mollenkopf will lead that selection process.
Boeing says Calhoun “announced his decision to step down as CEO at the end of 2024, and he will continue to lead Boeing through the year to complete the critical work underway to stabilise and position the company for the future”.
Some aerospace analysts recently insisted Boeing make sweeping management changes in response to nagging quality shortcomings. The company had significantly slowed 737 production following the 5 January in-flight failure of a 737 Max 9’s mid-cabin door plug – an issue apparently due to workers failing to install four bolts to secure the plug.
“If there were to be… regime change, I think they could turn it around and do a really good job,” Richard Aboulafia, aerospace analyst with AeroDynamic Advisory, said of Boeing in February.
But the shake up seems “abrupt” to Michel Merluzeau, analyst with consultancy AIR.
“The [company’s] problems are on the floor, not necessarily in the C-suite,” he says. “The focus in the near term should be on operational improvements and I question the benefits of replacing very high leadership.”
Calhoun also disclosed the management overhaul in a message to employees.
“I originally agreed to take on the role of CEO of Boeing at the board’s request, stepping down as board chair in the process, because of the unprecedented circumstances the company was facing at that time.”
Calhoun succeeded Dennis Muilenburg as Boeing chief executive in 2019 as the company was attempting to steer itself out of the original 737 Max crisis, which stemmed from two deadly crashes caused by several factors, including Boeing’s design of the aircraft’s flight control system.
“It has been the greatest privilege of my life to serve in both roles and I will only feel the journey has been properly completed when we finish the job that we need to do,” Calhoun’s letter says. “My decision to step down as CEO at the end of this year is one the board has been prepared for and will result in a number of changes at a management and governance level moving forward.”
“I am confident that the way we have confronted these challenges, and how we are responding to this specific moment, is establishing standards for future generations of employees and will be woven into the fabric of how we operate for decades to come,” Calhoun adds.
Pope’s assignment to lead Boeing Commercial Aircraft is effective today. She had become the company’s chief operating officer in January, and previously had been head of Boeing Global Services and chief financial officer of Boeing Commercial Airplanes.
Pope, with a 30-year Boeing career, “has a proven track record of superb leadership, including an innate talent for listening and responding to our people”, Calhoun writes.
Deal had been at the helm of Boeing Commercial Airplanes since taking over from Kevin McAllister in 2019.
“I want to thank Stan for his many contributions and dedication since first joining our ranks 38 years ago, and for his tireless service as our BCA leader during an uncommonly difficult period for our company and for our industry,” Calhoun’s letter says.
New board chair Mollenkopf become a Boeing director in 2020 after a career that included time as CEO of telecommunications company Qualcomm.
“Steve has had a long and extraordinarily successful career with decades of experience as both a CEO of Qualcomm and a board member of several important public companies,” Calhoun writes.
Kellner “had been considering the appropriate moment to turn over the reins after more than four years as chair and 13 years on our board”.
The 5 January incident prompted the Federal Aviation Administration to launch a quality audit of Boeing and to cap Boeing’s 737 output at 38 jets monthly, though the company has recently been producing the jets at much lower rate. Also in January, Boeing disclosed it needed another year to certificate its long-delayed 737 Max 7.
In recent weeks, bosses at some of Boeing’s top customers – including United Airlines and Southwest Airlines – lobbed criticism at the company. And last week news outlets reported that some airline CEOs planned to discuss their concerns directly with Boeing’s board of directors – but not with Calhoun.
