Boeing CEO removed due to ongoing crisis

Two days before Christmas, Boeing announced that Dennis Muilenburg had stepped down from his role as the company’s CEO and Board Director, with immediate effect. His position will be temporarily filled by CFO Greg Smith until January 13, when David Calhoun will be made the CEO and President of the Company.

Although not publically directly connected,  it is believed that the move stems from the growing 737 MAX crisis which has intensified over the last few months. Boeing had hoped to have the airliner re-certified by the end of 2019, however, the FAA’s Stephen Dickson publicly shut down the idea, slipping the timeline of return to service to as late as Q2 2020. This would mean that it would be an entire year without a single 737 MAX flying commercially. The MAX was placed under a worldwide grounding in March 2019, following the second crash of the type in Ethiopia.

The length of the grounding has resulted in Boeing running out of space to store the aircraft, which is also causing a significant cash flow crisis as payment for this aircraft has not been received/ Boeing is unable to recuperate the costs of production until the airliners are delivered.

Some airlines still view the timeline as unrealistic with United removing the MAX from its schedules until June 4, 2020. United was one of the first three US operators to fly the now-troubled type, the others being American Airlines and Southwest.

“I strongly believe in the future of the Boeing 737 MAX. I am honoured to lead this great company and the 150,000 dedicated employees who are working hard to create the future of aviation,” said the newly appointed CEO and President Calhoun, who joined Boeing in 2009.