Boeing CEO to resign over Max 737 controversy

Dave Calhoun, Boeing CEO announced Monday he will resign at the end of the year.

The planemaker has faced scrutiny since the Alaska Airlines blowout on January 5.

Larry Kellner, the board chair has informed the board that he does not intend to stand for re-election at the upcoming Annual Shareholder meeting. The board has elected Steve Mollenkopf to succeed Kellner as independent board chair. In this role, Mollenkopf will lead the board’s process of selecting Boeing’s next CEO.

“It has been the greatest privilege of my life to serve Boeing,” said Calhoun in a letter to employees. “The eyes of the world are on us, and I know that we will come through this moment a better company. We will remain squarely focused on completing the work we have done together to return our company to stability after the extraordinary challenges of the past five years, with safety and quality at the forefront of everything that we do.”

Kellner has served on the Boeing Board for 13 years and served as its chair since late 2019. As chair, he oversaw the establishment of a new board aerospace safety committee, and during his tenure led the recruitment of seven new independent directors, bringing deep engineering, safety, manufacturing, and aerospace expertise to Boeing’s board.

“Boeing plays an essential role in our world, and serving this company, and our people, has been a true honor,” said Kellner.

“After over a decade on the board and several years as its chair, I have been considering the right time for a transition of leadership on our board, and have been discussing that subject with Dave and the board in conjunction with Dave’s planning about his succession timeframe.

“I want to thank Dave for his tremendous leadership of our company, and I know he will finish the job this year that he started in 2020 to position Boeing, and our employees, for a stronger future.

“With Dave’s decision to step down as CEO at the end of this year, now is the right time for a transition to my successor. Steve is the ideal next leader to take on the role of board chair, and the CEO selection process must be led by a new chair who will stay at the helm as a partner to the new CEO. With a strong board, an excellent management team, and 170,000 dedicated Boeing employees, I am fully confident in our company’s future.”

The Federal Aviation Administration’s (FAA) audit of Boeing’s 737 MAX production process after a panel blew off on an Alaska Airlines jet in January failed 33 of 89 tests.

In the wide-ranging investigation, Boeing failed a check that dealt with the component known as a door plug, the report said, citing an FAA presentation viewed by NYT.

Boeing’s shares immediately came down 1.4 percent in premarket trading.

Additionally, an audit at Spirit focusing on the door plug component found five problems and it failed the one which dealt with the installation of the component.