Will Ford's Mullaly Be Boeing's Next CEO?
The problems with electrical systems on the Boeing Co. (NYSE: BA) 787 Dreamliner are so severe that the plane may not fly for months. Production has backed up, and airlines almost certainly will ask for compensation. There is no doubt who is ultimately responsible for the failure - Chairman and CEO W. James (Jim) McNerney, who joined Boeing in 2005, about the same time as the serious development of the 787 began. The board of Boeing cannot keep McNerney under these circumstances. The most logical person for them to turn to is Ford Motor Co. (NYSE: F) CEO Alan Mullaly.
Mullaly has engineered a spectacular turnaround at Ford and made it the only one of the Big Three to avoid bankruptcy. Ford already has begun to prepare for his retirement, which could come in little more than a year. Ford does not need a turnaround expert anymore. Mullaly's efforts have been that successful.
Mullaly ran the Boeing Commercial Airplanes division until he was passed over for the CEO job, which went to McNerney. Mullaly left for Ford in 2006. With that background, Mullaly knows the airline industry as well as almost any executive in the world. He is an engineer who graduated from MIT and worked on versions of almost all the planes Boeing currently sells.
Boeing needs to make a move now so that it can address two problems. The first is that it must regain confidence with customers, shareholders and employees. McNerney cannot do that. His failures are too extensive. Boeing also needs a leader who can step into the job quickly and will not need months and months to learn about the company and its operations.
Today, Boeing is rudderless, perhaps the worst condition in which a large public company can find itself. Mullaly has been the rudder of Ford. It is time for the Boeing board to hire him before its situation becomes much worse.
Filed under: 24/7 Wall St. Wire, Corporate Governance Tagged: BA, F