SEATTLE, 24 DECEMBER 2019 — Boeing has sacked its chief executive Dennis Muilenburg following a year of intense scrutiny and industrial setbacks set off by two fatal crashes of its 737 MAX jetliners.
The company announced that chairman David Calhoun would take over as CEO and president from 13 January, saying a change in leadership was necessary to restore confidence in the company.
The management shakeup comes as the world’s largest plane maker struggles to win regulatory approval for its grounded best-selling jetliner, while also trying to regain trust with passengers and airline customers.
The US aerospace giant decided to hit pause on making the 737 MAX after a two-day meeting in Chicago last week.
It followed news the U.S Federal Aviation Administration (FAA) would not approve the plane’s return to service before 2020.
The company said it would stop production of the jets in January.
The 737 MAX has been grounded since March, after crashes in Indonesia and Ethiopia within five months of each other killed 346 people and cost the plane manufacturer more than US$9 billion.
The 737 MAX crisis was the biggest of Muilenburg’s 34-year tenure at Boeing, where he started as an intern in 1985, rising through the company’s defence and services ranks to the top job in 2015.
Boeing has also suffered setbacks in space.
Boeing’s CST-100 Starliner capsule returned to Earth on Sunday after a software problem prevented it from reaching the orbit needed to dock with the International Space Station as planned.
While it Boeing space chief executive Jim Chilton told reporters the landing “couldn’t really have gone any better”, it was deemed a blow to the company’s effort to launch astronauts for NASA next year.
Speculation that Muilenburg would be sacked had been circulating in the industry for months, intensifying in October when the board stripped him of his chairman title.
A Boeing official said the board deliberated over the weekend and made the decision to fire Muilenburg in a phone call on Sunday (local time).
“Under the company’s new leadership, Boeing will operate with a renewed commitment to full transparency, including effective and proactive communication with the FAA, other global regulators and its customers,” Boeing said.
Aerospace analyst Richard Aboulafia said the appointment of Calhoun — who previously served as head of Blackstone Group’s private equity portfolio operation — would provide needed short-term stability, but not the long-term “emphasis on engineering” the company needed.
“Calhoun is respected in the industry,” Aboulafia said.
Board member Lawrence Kellner will become non-executive chairman of the board, effective immediately, while chief financial officer Greg Smith will serve as interim CEO during the brief transition period, the company said….(PACNEWS)