Wall Street may not have been too surprised to learn on Monday that Boeing has fired its CEO Dennis Muilenburg.
Boeing has been struggling all year with its 737 Max crisis after two fatal plane crashes.
The company announced that it has replaced Muilenburg effective immediately and in his place will be Chairman David
Calhoun. Calhoun will take over starting on January 13th.
The transition period will allow Calhoun to exit his non-Boeing commitments. Board member Lawrence Kellner will become Boeing’s nonexecutive chairman, effective immediately.
“The Board determined that a change in leadership was necessary to restore confidence in the company moving forward and that we will proceed with a renewed commitment to full transparency, including effective and proactive communications with the FAA, other global regulators and our customers,” CFO Greg Smith stated. Smith became interim CEO for the time being.
Smith’s letter reads as follows:
Colleagues, This morning, Boeing announced leadership changes made by our Board of Directors:
Dave Calhoun, currently Chairman of the Board, will become Chief Executive Officer of Boeing on January 13, 2020.
Larry Kellner, currently a Board director, will become Chairman of the Board effective immediately.
Dennis Muilenburg has resigned from his positions as CEO and Board director effective immediately.
I will serve as interim CEO during the brief transition period as Dave Calhoun prepares to assume leadership of the company.
The Board determined that a change in leadership was necessary to restore confidence in the company moving forward and that we will proceed with a renewed commitment to full transparency, including effective and proactive communications with the FAA, other global regulators and our customers.
On a personal note, I want to extend my deep gratitude to Dennis for his deep and abiding commitment to Boeing as CEO over these past four years, and for his nearly 35 years of service to the company. Dennis gave his all to the company under extraordinarily difficult circumstances. I look forward to working closely with Dave Calhoun, whom I have known for a very long time.
Dave and I share a mutual respect for one another, and I know we will work well together as we chart a new direction for Boeing. This has obviously been a difficult time for our company, and our people have pulled together in extraordinary ways. Over the next few weeks as we transition to new leadership, I am committed to ensuring above all that we meet the needs of our stakeholders – especially our regulators, customers and employees – with transparency and humility.
I am confident in our new leadership and I believe in our team — we have a plan in place, and it is very important that all of us remain focused on the tasks at hand. While this has been an extremely difficult year for all of us at Boeing, I firmly believe we are taking the right steps to reinforce the best in our values and to put the Company on the right path for a strong future. While today brings important changes for our company, I am also reminded of the many things that will remain exactly the same.
We will continue to operate according to our purpose and values in service of our customers, business partners, regulators, and other stakeholders. I want to thank you for going above and beyond expectations during what has been an extremely challenging year. I hope you are able to enjoy some time with loved ones and friends during these holidays. I am so proud to work alongside you all as part of this great company.
Boeing shares were up nearly 3% on Monday on the news.
The FAA declined remarked “Our first priority is safety, and we have set no timeframe for when the work will be completed,” referring to reviewing the proposed changes from the company.
“We expect that Boeing will support that process by focusing on the quality and timeliness of data submittals for FAA review, as well as being transparent in its relationship with the FAA as safety regulator.”
Disclaimer: We have no position in Boeing Co. (NYSE: BA) and have not been compensated for this article.