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Embattled aerospace giant Boeing has recorded a staggering $1.4bn loss in the second quarter of 2024, as it brings a new CEO on board in a bid to turn around its struggling finances and reputation.
The troubled plane manufacturer has faced a tumultuous seven months after being embroiled in a string of safety and quality concerns with a plane door blowing off mid-flight, whistleblowers coming forward with damning claims and a conviction of conspiring to defraud the US.
On Wednesday, the company announced its quarterly financial statements, revealing revenues even lower than Wall Street analysts anticipated.
In total, Boeing’s revenues were down 15 per cent in the three months ending June 30 compared to the same period a year earlier.
In a bid to repair the company’s fractured finances and reputation, the company announced that Kelly Ortberg, the 64-year-old former chief executive of supplier Rockwell Collins, has been appointed as CEO, effective August 8.
Ortberg, a former mechanical engineer, “has the right skills and experience to lead Boeing in its next chapter,” chairman Steven Mollenkopf said in a statement.
Ortberg said in a statement from the company on Wednesday that there is “much work to be done”.
“I’m extremely honored and humbled to join this iconic company,” he said.
“Boeing has a tremendous and rich history as a leader and pioneer in our industry, and I’m committed to working together with the more than 170,000 dedicated employees of the company to continue that tradition, with safety and quality at the forefront,” he added.
Outgoing CEO David Calhoun resigned back in March. In the earnings release, Calhoun noted that Boeing has had a “challenging quarter,” but said that the business is making “substantial progress” for the future.
The company’s flailing finances have been blamed, in part, on quality and safety issues surrounding Boeing’s aircraft.
Questions have mounted as to whether it is safe to fly on Boeing planes, following a dramatic moment on a 737 Max aircraft in January.
Alaska Airlines flight 1282 was forced to make an emergency landing in Portland, Oregon, after a doorplug – a panel of the fuselage near the rear of the aircraft – blew out as the plane reached 16,000 feet.
The Federal Aviation Administration demanded that the company halted production of the 737 Max until the regulator was satisfied that safety and quality issues had been addressed. These lower production levels will likely spell further losses for Boeing.
A string of terrifying incidents also followed including a wheel falling off a United Airlines Boeing 757-200 moments after it took off from Los Angeles earlier this month.
The aftermath of such incidents has resulted in dozens of Boeing whistleblowers coming forward with claims of alleged bad working habits and the intentionally use of defective parts.
Ron Irvin, a former quality investigator at Boeing for six years, told The Independent that the aircraft manufacturer was “infested with ‘yes men’” and full of “bean counters”.
Boeing is also dealing with supply-chain issues that are hindering production as it re-acquires key contractor Spirit AeroSystems.
Then, last week, the company accepted a plea deal with the Justice Department to plead guilty to one count of conspiracy to defraud the United States.
The charge relates to the company misleading federal regulators into approving its 737 Max jetliner – the aircraft model that was later involved in two fatal crashes in 2018 and 2019, which together claimed the lives of 346 people.
Under the terms of the deal, the company was also hit with a $244m fine and ordered to undergo three years of probation whereby an independent, court-appointed monitor will take stock of its operations.
The deal means that Boeing avoids going to trial.
