Boeing Airbus on Wednesday announced the appointment of a long-time aerospace industry veteran as its new chief executive, who will take over a company rocked by legal, regulatory and production problems.
Boeing said Robert “Kelly” Ortberg, former CEO of the company’s supplier Rockwell Collins, will succeed David Calhoun as CEO and president effective Aug. 8. Announced in March Trump has announced he will retire at the end of the year, and analysts have generally praised the quick transition.
Boeing Co. announced a new chief executive after reporting a loss of more than $1.4 billion on lower revenue in the second quarter. The loss was larger and revenue fell short of Wall Street expectations, as both Boeing’s commercial airplanes business and defense unit lost money.
The disappointing results come at a turbulent time for Boeing. agreed to plead guilty This month he was charged with federal fraud in connection with 737 Max Two crashes killed 346 people. The Federal Aviation Administration increased its oversight of the company after panel explosion On an Alaska Airlines flight, a manufacturing quality issue has raised concerns.
Boeing Chairman Stephen Mollenkopf said Ortberg was selected after a “comprehensive and extensive search process” and “has the right skills and experience to lead Boeing into its next chapter.” Mollenkopf added that Ortberg has built a reputation for managing complex engineering and manufacturing companies.
A company spokesman said the company waived Ortberg’s mandatory retirement age of 65. Boeing did the same. For Calhoun Days after turning 64 in 2021.
Ortberg has only recently emerged as a leading candidate. Other reported candidates include Patrick Shanahan, a former Boeing executive and current CEO of its top supplier, Spirit Aerosystems, and Stephanie Pope, another longtime Boeing executive who recently took over the commercial airplanes division.
Ortberg was president of Rockwell Collins from 2013 to 2018, when it merged with United Technologies and became part of RTX, the company formerly known as Raytheon. He retired from RTX in 2021.
The appointment is great news for Boeing, said Richard Aboulafia, a longtime aerospace analyst and consultant and a recent harsh critic of the company.
“He is a deeply respected leader in the aviation industry, and brings more hope for a better future than the company has enjoyed in decades,” said Abu Al-Afia.
Daniel Acker/Bloomberg – Getty Images
Deutsche Bank analyst Scott Duschl said Ortberg “has an engineering background, experience in the aerospace industry and experience as a CEO of a public company.”
“There is a lot of work to be done, and I look forward to getting started,” Ortberg said in a statement from Boeing.
Calhoun will serve as a special advisor to Boeing’s board of directors until next March.
Like Calhoun, who He assumed the position of CEO. In the wake of the two Max crashes, Ortberg will inherit leadership of a company facing ongoing crises and criticism from inside and outside the company. Boeing has lost more than $25 billion since the start of 2019.
Boeing, headquartered in Arlington, Virginia, is taking a stand against the idea. Whistleblower allegations The company is facing a number of manufacturing shortcuts that are hampering safety. It is also dealing with supply chain issues that are hampering production, which it hopes to fix in part by Spirit AeroSystems Reacquisitiona major contractor. The company faces a strike threat this fall from its largest union, the International Association of Machinists.
The company is still trying to convince regulators to approve two new Max models and a larger version of its two-seater model. 777 jetThe company faces a multibillion-dollar decision on when to design a new single-aisle jet to replace the Max.
Boeing’s quarterly earnings, reported Wednesday, reflect the ongoing challenges the company faces. The company reported a loss of $1.44 billion in the second quarter, compared with a loss of $149 million a year earlier.
Excluding special items, the loss was $2.90 per share. Analysts had expected a loss of $1.90 per share, according to a FactSet poll.
Revenue fell 15% to $16.87 billion, below Wall Street’s average forecast of $17.35 billion.
The commercial airplanes division posted an operating loss of $715 million, and revenue fell 32%, as Boeing delivered fewer passenger jets to airlines — 92, compared with 136 the year before.
The Federal Aviation Administration limited Boeing’s production of the Max jets shortly after the Alaska Airlines crash, but Boeing has not even reached the FAA’s limits as it seeks to overhaul its manufacturing process. The company said Wednesday it is sticking to its plan to increase Max production to 38 planes a month by the end of the year.
Boeing has taken a $244 million charge to cover a fine it will pay as part of its Agreement with the Ministry of Justice Boeing has pleaded guilty to fraud in connection with the development of the Max. A federal judge in Texas will soon consider approving the deal, which is opposed by many families of victims of two Max crashes.
Boeing’s defense and space unit lost $913 million due to $1 billion in setbacks on four fixed-price government contracts, including a deal to build two new Air Force One presidential jets. The smaller services business took in $870 million.
Boeing shares rose 2% in morning trading.