Boeing leadership shakeup raises questions after 737 Max 9 blowout

The resignation of Boeing CEO David Calhoun has cast doubt on the future of the beleaguered airline company as it navigates the aftermath of a high-profile bankruptcy earlier this year.

Calhoun announced Monday that he will step down as CEO at the end of the year. Calhoun, who was deployed to assist Boeing with repairs following the deadly 737 Max 8 crashes in 2018 and 2019, was killed in a 737 Max 9 fuselage during an Alaska Airlines flight in January. The panels were blown away and we departed amidst a new catastrophe.

Boeing also announced that Larry Kellner, chairman of the company’s board, will step down later this year and be replaced by Steve Mollenkopf. Stan Diehl, president and CEO of Boeing Commercial Airplanes, has resigned effective immediately and been replaced by Stephanie Pope.

Ashley Fulmer, assistant professor of management science at Georgia State University’s Robinson College of Business, told The Hill: “The leadership shakeup provides a tangible signal that Boeing is holding itself accountable. ” he said.

“But this is a strategy that Boeing has used repeatedly without successfully addressing safety issues,” Fulmer added.

Boeing fired Mr. Calhoun’s predecessor, Dennis Muilenburg, in 2019 following two fatal crashes involving Boeing 737 Max planes that killed 346 people.

“The rapid succession of CEOs could leave lawmakers and regulators questioning who ultimately holds responsibility for the accidents and what the plan is to resolve the problem. Are we going to check?” Fulmer said.

Robert Byrd, a business law professor at the University of Connecticut, told The Hill that “a change in Boeing’s leadership alone will not be enough to solve the problem.”

“Boeing must go through a long and difficult process of changing its business culture. Safety and quality must be second to none,” Bird said.

Asked for comment, a Boeing spokesperson pointed to the company’s previous pledge to be “as transparent as possible” while focusing on “safety and quality.”

The accident has prompted regulators and lawmakers to call for increased oversight of the company.

A recent investigation by the Federal Aviation Administration (FAA) and aviation experts found significant gaps and confusion surrounding Boeing’s safety culture and policies.

FAA Administrator Michael Whitaker expressed concern about Boeing’s “safety culture issues.”

“Their priority was production, not safety or quality. So what we’re really focused on now is moving the focus from production to safety and quality,” Whittaker said last week. said in an interview.

The Justice Department also opened a criminal investigation after the company admitted it could not find records requested by the National Transportation Safety Board (NTSB) panel about factory work.

Boeing also faces multiple lawsuits filed by shareholders and passengers who say they were misled about “significant safety deficiencies” after the explosion.

In a letter to employees on Monday, the CEO called the crash a “watershed moment for Boeing” and called on the company to respond with “humility and full transparency.” Ta.

In the wake of the 2018 and 2019 crashes, Boeing also revamped its lobbying efforts, which are key to raising the company’s profile among policymakers at a time when it is under new scrutiny. It has become.

Boeing has built one of the largest lobbying operations in Washington, spending $14.5 million on federal lobbying efforts in 2023 and managing the efforts of 109 registered lobbyists, including five former members of Congress. There has already been one major change to the roster this year, with Boeing parting ways with Cornerstone Government Affairs for the first time in nearly 14 years.

A Boeing spokesperson also previously told The Hill that the airline giant’s in-house lobbying team has contacted every member of Congress since the January explosion.

In Monday’s letter, Calhoun acknowledged that Boeing “must instill a strong commitment to safety and quality at every level of the company.”

Mr. Calhoun was instrumental in developing a plan that would bring about “significant changes” to the company.

Whoever succeeds Calhoun will continue the promise of reforms adopted in the wake of the recent crisis facing Boeing.

Calhoun will be succeeded by General Electric CEO Lawrence Culp, Boeing director and airline CEO David Gitlin, Northrop Grumman CEO Kathy Worden, and Forbes’ newly appointed CEO of Boeing Commercial Airplanes. Several names have been floated, including Mr. Pope, president and CEO. report.

The question of who will ensure Boeing sticks to these reforms is that “top leaders are seen as rotating, temporary representatives, so concrete promises, commitments, and compliance are more important than words and plans in Washington.” “This could lead to calls for more,” Fulmer said.

But ultimately, Bird said, “engineers who care about safety and quality have to lead the way.”

“The company must fundamentally change the direction of its goals and practices. If it doesn’t, it’s only a matter of time before Boeing faces further difficulties,” Bird said.