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Boeing's Board Shakes up C-Suite, Splitting Chairman and Chief Executive Officer Roles

Updated: Jan 11, 2020

Amidst the continued Boeing 737 MAX grounding, Boeing’s Board of Directors has decided to separate the Chairman and CEO roles. Dennis Muilenburg remains CEO, President and Director and David Calhoun has been elected Non-Executive Chairman.

Boeing 737 MAX Family - Courtesy Boeing

In a press release late Friday, Boeing (NYSE: BA) announced that the chairman and CEO roles, previously held by Dennis Muilenburg, would be split, with David L. Calhoun, independent lead director, elected by the board to serve as non-executive chairman. Mr. Muilenburg will retain his roles as CEO, president and director. According to Boeing’s Board of Directors, splitting the roles will allow Mr. Muilenburg to focus on the safe return of the 737 MAX, support Boeing’s customers worldwide and implement product and services safety initiatives. In the announcement, Mr. Calhoun stated,

“The board has full confidence in Dennis as CEO and believes this division of labor will enable maximum focus on running the business with the board playing an active oversight role. The board also plans in the near term to name a new director with deep safety experience and expertise to serve on the board and its newly established “Aerospace Safety Committee.”

As we approach the first anniversary of the October 29, 2018 Lion Air 737 MAX accident, Boeing is under pressure on all fronts. When the fleet was grounded last March after the Ethiopian Airlines accident, few believed the grounding would last more than a few months. Recently, cracks have been discovered on certain Boeing 737 NG (Next Generation) aircraft, requiring a fleetwide inspection, and last week Russian flag carrier Aeroflot cancelled an order for 20 Boeing 787 Dreamliners. Yesterday, United Airlines announced that they had removed the 737 MAX from their schedule until January 6, 2020, the last North American Airline to do so.

When the Federal Aviation Administration (FAA) finally recertifies the aircraft, it will require a herculean effort to inspect, modify and update the grounded aircraft, not to mention retraining all pilots and maintenance personnel on the new systems. For now, North American carriers are hoping for a January 2020 return, but foreign operators may have to wait several additional months, pending recertification by independent sovereign civil aviation authorities such as the European Union Aviation Safety Agency (EASA). In a previous article, Ryanair CEO Michael O’Leary stated that he believed the MAX wouldn’t fly again in Europe until Late February or March. Meanwhile, Mr. Muilenburg is set to testify before a congressional committee on October 30th, along with Boeing's chief engineer for the commercial airplanes division and chief 737 pilot.

Source: Boeing



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