Battered aerospace giant Boeing revealed major leadership changes early Monday as the Dow Jones airplane manufacturer contends with supply chain and quality control issues. Boeing stock rose on the news. Elsewhere, United Airlines tumbled after the Federal Aviation Administration on Saturday said it is considering increasing oversight of the Chicago-based carrier.
Boeing CEO Dave Calhoun will step down at the end of 2024. Calhoun became Boeing's president and chief executive in January 2020 after Dennis Muilenburg was ousted in the aftermath of two deadly 737 Max crashes, according to reports.
Stan Deal, head of Boeing's commercial airplanes division, retired effective immediately. COO Stephanie Pope was named Commercial Airplanes CEO.
Chairman Larry Kellner announced he will not run for reelection at Boeing's annual meeting in May. Kellner has served on the board for 13 years and was named independent chair in 2019. Boeing appointed board member Steve Mollenkopf to succeed Kellner and lead the process of selecting the new CEO.
The executive shake-up comes as the Dow Jones aerospace giant faces heightened oversight from regulators after a 737 Max fuselage blew out during an Alaska Air flight in January. Boeing informed various airlines of delivery delays in mid-March as it works to mend its quality control and production issues.
Boeing Stock Rises Premarket
BA stock rose 1.4% Monday after surging premarket 4% on the news.
Shares closed just shy of their 21-day exponential moving average.
Boeing stock reversed higher for a 3.5% gain last week. Still, the Dow Jones stock has tumbled 26.6% so far this year following the January emergency landing.
United Airlines Oversight
Meanwhile, the FAA is considering new temporary measures against United Airlines following a string of flight incidents over the past month, according to multiple Saturday reports. The regulator said it will initiate a formal evaluation of United Airlines to ensure it is complying with safety regulations.
Some of the actions discussed include barring new route launches, pausing the introduction of new planes into service and halting internal certifications of new captains. The unnamed sources familiar with discussions did not clarify when the pauses would occur or which actions would be taken.
United Airlines over the last several weeks faced its own mechanical issues, many of which involved Boeing aircraft.
A missing external panel was discovered on a March 15 United flight after it landed in Oregon. On March 8, a United 737 Max flight from Houston suffered an engine fire during takeoff. And a United-operated Boeing 777-200 plane bound for Japan landed safely on March 7 after losing a tire after takeoff.
UAL stock fell 3.4% Monday. Still, United Airlines swung 8.8% higher this year.
Rival Delta Air Lines eased 0.4% Monday.
American Airlines reversed after an early slide to close Monday with a 0.7% gain.
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