Troubled American plane manufacturer Boeing’s board is likely to choose a new CEO from outside its ranks as it navigates operational and legal challenges under 66-year-old Dave Calhoun, as per a Reuters report.
Calhoun is set to step down by 2024-end to make way for a new CEO. This comes after the company’s commercial planemaking chief and chairman have also exited amid the mounting controversies.
Also Read | Boeing CEO Dave Calhoun steps down, says ‘board has been prepared’ — Read full text here
The incoming CEO will face a plethora of tasks, including enhancing the company’s safety culture, addressing quality concerns, and rebuilding trust among regulators, customers, and the general public. Moreover, Boeing must fulfil its objectives to increase production rates and bolster cash flow to alleviate debt pressures and compete more effectively with its European rival Airbus, the report noted.
External Candidate Most Likely
So, the question arises: who will take up the CEO role from Calhoun? Analysts told Reuters they expect an “outsider” to take the post after the most favoured candidate Stephanie Pope was appointed as Chief Operating Officer three months ago, and more recently as head of Boeing’s commercial planes division.
“The company was teeing up Stephanie Pope to likely succeed Calhoun but that seems to have changed in favour of an external search for a new CEO. This could result in a high-profile hire,” Stifel analyst Bert Subin told Reuters.
Also Read | Boeing CEO Dave Calhoun, other senior executives to step down after series of high-profile safety incidents
They added that an external candidate is also being favoured for a “fresh perspective” on addressing concerns regarding Boeing’s quality and manufacturing practices.
Besides the industry watchers, unions on their part are advocating for a return to engineering leadership, to show prioritisation of quality and safety over shareholder interests, the report said.
Prospective Candidates for Boeing’s CEO Post
— Industry observers highlighted General Electric CEO Larry Culp as a potential candidate possessing the leadership qualities needed to rebuild confidence in Boeing. However, Culp has reiterated his commitment to leading GE Aerospace. Notably, GE Aerospace is a key partner and supplier to Boeing.
Also Read | Biggest Challenge Facing New Boeing CEO Is Winning Over Airlines
— Another contender is Pat Shanahan, former Boeing executive and current CEO of Spirit Aerosystems, a key supplier for Boeing’s troubled 737 MAX program. He was also once the acting United States Defense Secretary in the Trump administration.
Shanahan’s prospects look bright since Spirit used to be a Boeing subsidiary till 2005 and is under discussions now for acquisition. Industry veteran Adam Pilarski told Reuters he is “the perfect outsider” who knows the company and the people.
— Greg Smith, another former Boeing Chief Financial Officer and current chairman of American Airlines is also speculated to be in the running for the CEO position. Notably, Calhoun beat Smith for the CEO seat in 2021.
— David Gitlin, a Boeing board member, has also been mentioned as a potential candidate, although it remains uncertain whether he would relinquish his current role as head of Carrier Global.
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Published: 26 Mar 2024, 11:03 AM IST