Boeing CEO Dave Calhoun is leaving the company as the company faces a safety crisis

  • Written by Theo Leggett
  • Business correspondent, BBC News

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Boeing CEO Dave Calhoun

Boeing President Dave Calhoun will leave his post at the end of this year amid a deepening crisis over the company's safety record.

Boeing also said the head of its commercial airline division will retire immediately while its president will not run for re-election.

The company is under pressure after an unused door exploded on a Boeing 737 Max plane in January shortly after take-off.

No one was hurt, but the company's safety and quality control standards have come under renewed scrutiny.

Many analysts said Boeing's leadership change was long overdue.

“Change at the top is necessary,” said Stuart Glickman, an equity analyst at research firm CFRA, adding that he believes the current crisis stems from problems in the company's corporate culture that only a new vision can solve.

“I don't think you can change culture with internal voices because I think that's been the way this company has operated for a very long time.”

Calhoun took over the CEO role in early 2020 after the previous president, Dennis Muilenburg, was fired in the wake of one of the biggest scandals in Boeing's history.

Within five months, two new 737 MAX aircraft were lost in nearly identical accidents that claimed the lives of 346 passengers and crew.

One board member at the time, after becoming president of the company, promised to strengthen the “safety culture” and “rebuild trust” at Boeing.

However, in January of this year, an abandoned emergency exit door on Alaska Airlines' new Boeing 737 MAX exploded shortly after takeoff from Portland International Airport.

A preliminary report by the US National Transportation Safety Board concluded that four bolts intended to securely attach the door to the plane were not installed.

Boeing faces a criminal investigation into the accident itself, as well as legal action from passengers on board.

In a letter to employees on Monday, Calhoun called the Alaska Airlines incident a “defining moment” for Boeing and said it must respond “with humility and complete transparency.”

“The eyes of the world are on us, and I know we will get through this moment in better company,” he said.

Air safety activist Ed Pearson, a former senior manager at Boeing's 737 plant in Renton, Washington, said Calhoun had years to try to boost safety at the company.

“It was one failure after another,” said Pearson, who is now executive director of the Aviation Safety Foundation.

“The company deserves much better leadership, and the people who fly these planes deserve much better leadership.”

The explosion tested Boeing's relationships with its airline customers and regulators in Washington, reviving concerns that the company's culture focused on speed before safety.

The FAA said earlier this month that a six-week review of the 737 MAX production process at Boeing and its supplier Spirit Aerosystems found “multiple instances in which the companies failed to comply with manufacturing quality control requirements.”

Video explanation,

Watch: “Flight from Hell”: On the plane during a mid-air explosion

The findings came shortly after another report into Boeing's safety culture by a panel of experts, which found a “disconnect” between senior management and regular employees, as well as signs that employees were reluctant to report problems for fear of retaliation.

After the two planes crashed in October 2018 and 2019, it was found that faulty flight control software caused these accidents, which Boeing was accused of deliberately concealing from regulators.

The company agreed to pay $2.5bn (£1.8bn) to settle fraud charges and admitted deception, although it formally pleaded not guilty in subsequent court hearings.

It subsequently faced widespread accusations that it put profits before passengers' lives.

Mark Pegram, whose 25-year-old son Sam died when an Ethiopian Airlines 737 MAX crashed in 2019, said Calhoun appeared to have been brought in to say what investors wanted to hear and “not fix the cause of the problems that were happening.” Planes fall from the sky.”

He said he was happy with the change but disappointed that it took so long.

“It's something we've been advocating for for a long time now,” he said.

The crisis at Boeing has caused wider disruption in the travel industry as the company, one of the world's two largest aircraft makers, slows manufacturing lines in an attempt to control the problems.

Airlines, including Ryanair, have warned of rising ticket prices and tight flight schedules as they face delays in aircraft deliveries.

For Boeing, the slowdown is already generating multibillion-dollar charges, while rival Airbus is gaining an advantage. The company also faces criticism for failing to innovate.

Speculation has already begun about who might replace Mr. Calhoun, but the pool of people with the qualifications for such a job is small.

Air transport consultant John Strickland of JLS Consulting warned that the company still had hard work ahead of it.

“It's all very well getting rid of people, but what are you going to do to keep the business going?” Strickland said. “This is much easier said than done.”

The company's shares rose more than 1% after the changes were announced.

In addition to Calhoun, Stan Deal will leave his position as president of Boeing's Commercial Airlines division, effective immediately. He will be replaced by Stephanie Pope, who has spent the past three months working as Boeing's chief operating officer.

Larry Kellner, the company's president, will also leave, and will be replaced by Steve Mollenkopf, the former head of Qualcomm who has been on Boeing's board since 2020. He will lead the search for a new CEO.

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