David Calhoun took the reins at Boeing Co. under difficult circumstances. He was named to the job in December 2019 and officially had the CEO title in January 2020.
Boeing’s reputation was in tatters. The 737 Max, one of the Chicago-based company’s most important aircraft, was involved in two fatal crashes. The plane had been grounded. Boeing’s entire way of management had been called into question.
Flash forward to this week. Calhoun, 64, a former member of Boeing’s board of directors, has gotten a big vote of confidence from the board.
Boeing’s normal retirement age for its CEO is 65. The board extended it for Calhoun to 70.
Under Calhoun’s tenure, Boeing has gotten U.S. approval to get the 737 Max back into the air after fixes to address software problems with the aircraft. Boeing is seeking similar approval in other regions.
Calhoun had been Boeing’s chairman until the board decided to fire CEO Dennis Muilenburg in late 2019. That led to Calhoun getting the CEO job.
The new chief’s top job was to restore Boeing’s reputation after the 737 Max crisis.
The company’s image decline had gone beyond the two fatal crashes. The 737 Max controversy called into question whether Boeing had lost its way. Boeing had been known for engineering excellence. By the end of 2019, the question became whether Boeing was cutting corners to maximize profits.
For now, Boeing is moving to recapture at least some of its past image.
The maker of aircraft still faces many challenges. The aerospace industry still is seeking to recover from the COVID-19 pandemic that pared demand for air travel. Boeing’s customers canceled orders for new planes.
Other manufacturing industries have recovered faster than aerospace. But, as things stand now, aerospace will require more time to get back on its feet.
Nevertheless, Boeing’s prospects appear better now than they did a year ago, in the early stages of the pandemic.
“Boeing has effectively navigated one of the most challenging and complex periods in its long history,” Chairman Larry Kellner said in a statement announcing Calhoun’s revised retirement date.
Calhoun’s “dedication to renewing the company's commitment to safety, quality and transparency has been critical in building regulator and customer confidence,” the chairman said.
Boeing still is cutting jobs. The company still needs to rebuild its reputation. Viewing from the outside, it seems Boeing’s board has decided it’s not time to change the CEO. One important executive, Chief Financial Officer Gregory Smith, 54, is stepping down, effective July 9. He also had been a major figure helping Boeing navigate the 737 Max crisis and COVID-19 pandemic, according to The Wall Street Journal. Boeing is now searching for a Smith successor.
The board’s decision to extend Calhoun’s tenure is a sign of approval. Yet, Calhoun has a lot to accomplish. The fate of one of the most important U.S. manufacturers is riding on how well Calhoun does.