Boeing CEO to step down in shakeup amid safety crisis

(Reuters) — Boeing Co. CEO Dave Calhoun will step down by the end of the year in a broad management shakeup brought on by the planemaker’s sprawling safety crisis stemming from a January mid-air panel blowout on a 737 MAX plane.

The company also said Stan Deal, Boeing Commercial Airplanes President and CEO, would retire, and Stephanie Pope would lead that business. Steve Mollenkopf has been appointed the new chair of the board.

The leadership change caps weeks of turmoil at Boeing after the mid-air incident involving an Alaska Airlines-operated MAX 9 jet carrying 171 passengers turned into a full-blown safety and reputational crisis for the iconic planemaker.

Boeing shares have lost roughly one-quarter of their value since the incident.

Boeing is facing heavy regulatory scrutiny, and U.S. authorities curbed production while it attempts to fix safety and quality issues. The company is in talks to buy its former subsidiary Spirit AeroSystems to try to get more control over its supply chain.

Some investors expressed concern that this shake-up would not be enough to address long-standing safety issues that were the reason for Mr. Calhoun’s ascendance to CEO in the first place in 2020.

“We’ve long thought that the issues at Boeing have been seated in cultural challenges,” said Cameron Dawson, chief investment officer at Newedge Wealth.

Last week, a group of U.S. airline CEOs sought meetings with Boeing directors without Mr. Calhoun to express concern over the Alaska Airlines accident, saying it was an unusual sign of frustration with the manufacturer’s problems and Mr. Calhoun.

Mr. Calhoun, an industrial veteran who has held top positions at several troubled companies, became CEO in January 2020 with the mandate of steering the planemaker through a series of crises emanating from two MAX crashes in 2018 and 2019 that killed nearly 350 people.

Following the incident, the FAA curbed Boeing production to a rate of 38 jets per month, but CFO Brian West said last week it had not even reached that figure.