Boeing CEO Dave Calhoun announced on Monday that he will step down at the end of 2024, as part of a broad management shakeup for the embattled aerospace giant. The decision comes as the planemaker has grappled with a series of production and quality control issues, most notably the January incident when a panel blew out of a nearly new 737 MAX 9 plane flown by Alaska Airlines.
In a letter to employees, Calhoun described the Alaska Airlines Flight 1282 accident as "a watershed moment for Boeing," emphasizing the need for the company to respond with "humility and complete transparency." He stressed the importance of inculcating "a total commitment to safety and quality at every level of our company."
Calhoun, who was appointed to the top job in late 2019 and took the helm at Boeing in early 2020 after the company ousted its previous chief executive, Dennis Muilenburg, for his handling of the aftermath of two deadly 737 Max crashes, said he had been weighing the decision to step down "for some time."
In addition to Calhoun's departure, Boeing announced that Larry Kellner, chairman of its board, will not stand for re-election at the company's upcoming annual shareholders meeting. Steve Mollenkopf, the former CEO of Qualcomm and a Boeing board member since 2020, will replace Kellner and lead the company's search for its next CEO.
Stan Deal, president and CEO of Boeing Commercial Airplanes, is also leaving the company effective immediately. Stephanie Pope, who recently became Boeing's Chief Operating Officer after previously running Boeing Global Services, will assume Deal's role.
The departures come as airlines and regulators have been increasing calls for major changes at the company following a host of quality and manufacturing flaws on Boeing planes. Last week, airline CEOs started scheduling meetings with Boeing directors to voice their displeasure at the lack of manufacturing quality controls and lower than expected production of 737 Max planes.
Boeing CFO Brian West recently stated that the company would see cash outflows of up to $4.5 billion during the current quarter as it works to shore up its production lines. Despite the challenges, Boeing stock rose as much as 2.5% following the news of the leadership changes, although the stock had lost more than 27% this year through Friday's close.
Calhoun has repeatedly promised investors, airline customers, and the general public that Boeing will get its myriad quality struggles under control. In his letter to employees, he acknowledged the scrutiny the company faces, stating, "The eyes of the world are on us, and I know we will come through this moment a better company, building on all the learnings we accumulated as we worked together to rebuild Boeing over the last number of years."
The leadership shakeup at Boeing comes as the company continues to face the repercussions of the 737 Max crashes in 2018 and 2019, which together resulted in the death of 346 people. The recent Alaska Airlines incident has further intensified the pressure on the planemaker to address its quality control and manufacturing issues.
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