Boeing Chief Executive Officer, Dennis Muilenburg, has resigned as the 737 MAX crisis escalates into the new year; sending shares climbing more than two percent to $335.24, in early trading.
The announcement comes as the company announced production of the 737 MAX would temporarily halt in January; as a result of intense scrutiny from aviation regulators, following the two fatal crashes of the type that left 346 people dead.
Consequently, Boeing’s Board of Directors has named current Chairman, David L. Culhoun, as Chief Executive Officer and President. The leadership change will be effective as of 13th January 2020. Additionally Board member Lawrence W. Kellner will become non-executive Chairman of the Board, effective immediately.
Since Mr Muilenburg has elected to resign from his positions as Chief Executive Officer and Board director with immediate effect, Boeing Chief Financial Officer Greg Smith will serve as a temporary CEO during the transition period.
Boeing said in a statement that the Board of Directors decided that a change in leadership was required to restore confidence in the company, as they progress in repairing relationships with customers, regulators and all other stakeholders.
“On behalf of the entire Board of Directors, I am pleased that Dave has agreed to lead Boeing at this critical juncture. Dave has deep industry experience and a proven track record of strong leadership, and he recognises the challenges we must confront. The Board and I look forward to working with him and the rest of the Boeing team to ensure that today marks a new way forward for our company.”Board member Lawrence W. Kellner
Mr Muilenburg has been under fire throughout the duration of the 737 MAX crisis, as a result of his poor handling of the situation. As lawmakers, aviation safety regulators, airlines and those affected by the two crashes continue to work around the 737 MAX case, he has pushed to have the aircraft return to service; sending anger levels rising.
Reuters notes that the 737 MAX grounding was the biggest crisis of Muilenburg’s 34-year occupancy at Boeing. He started as an intern in 1985 before rising through the company’s defence and secrecy ranks to the CEO position in 2015.
Boeing engineers must work with the Federal Aviation Administration and other regulators to certify the Manoeuvring Characteristics Augmentation System (MCAS) before the aircraft can commercially fly again. It is understood that at least a dozen more steps are required before certification can be issued.
“I strongly believe in the future of Boeing and the 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.”David L. Culhoun
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