CEO Dave Calhoun Set to Depart in Company Shake-Up

Boeing CEO Dave Calhoun is set to depart by year-end amid escalating concerns regarding the company’s safety track record. Additionally, the head of Boeing’s commercial airlines division, Stan Deal, will retire immediately, while Chairman Larry Kellner will not seek re-election, signaling a significant leadership overhaul.

The aircraft manufacturer faces heightened scrutiny following an incident in January where an unused door blew off a Boeing 737 Max shortly after take-off, raising questions about safety and quality control standards. Analysts suggest that leadership changes are long overdue, with many attributing the crisis to underlying issues within Boeing’s corporate culture.

Stewart Glickman, an equity analyst at CFRA Research, emphasizes the need for fresh perspectives to address entrenched cultural problems within the company. Calhoun assumed the CEO role in 2020 following the dismissal of his predecessor, Dennis Muilenburg, in the aftermath of two fatal crashes involving the 737 Max.

Despite Calhoun’s pledge to enhance Boeing’s safety culture, the January incident involving the Alaska Airlines flight underscored ongoing challenges. An initial investigation revealed that critical bolts securing the door were not properly installed. Boeing faces both criminal probes and legal action from affected passengers.

In response, Calhoun acknowledged the severity of the situation and vowed to prioritize transparency and humility moving forward. However, concerns persist regarding Boeing’s corporate culture, particularly its focus on speed over safety.

Regulators and airline customers alike have expressed apprehension, citing a disconnect between senior management and frontline staff, as well as reluctance among employees to report safety issues. Previous incidents involving flawed flight control software and allegations of regulatory deception have further tarnished Boeing’s reputation.

Michael Stumo, who lost his daughter in one of the crashes, deems the leadership changes necessary but urges Boeing to seek a global CEO with a proven track record in manufacturing safety and quality. The crisis has reverberated throughout the travel industry, impacting aircraft deliveries and prompting warnings of higher ticket prices from airlines like Ryanair.

Amid the upheaval, Airbus has capitalized on Boeing’s setbacks, while criticism mounts over Boeing’s perceived lack of innovation. Nevertheless, the announcement of leadership changes has spurred a modest uptick in Boeing’s stock price, signaling investor confidence in the company’s ability to navigate through turbulent times.

Stephanie Pope will assume Deal’s position as head of Boeing’s commercial airlines division, while Steve Mollenkopf, former Qualcomm CEO and current Boeing board member, will succeed Kellner as chairman and oversee the search for Calhoun’s replacement.