Current chairman David L. Calhoun will take over as CEO and President beginning January 13, with CFO Greg Smith set to serve as interim CEO until then, Boeing added in a statement. Board member Lawrence Kellner will become non-executive chairman of the board, effective immediately.
Boeing’s board of directors “decided that a change in leadership was necessary to restore confidence in the Company moving forward as it works to repair relationships with regulators, customers, and all other stakeholders,” according to the statement.
Shares of Boeing were halted in early trading ahead of the announcement, after closing 1.65% lower Friday. The stock climbed 3.4% to $339.00 per share as of 9:33 a.m. ET, shortly after trading resumed.
The leadership shake-up comes months after a March crash of Ethiopian Airlines Flight 302 marked the second deadly incident in less than six months for a Boeing 737 Max. In total, the two crashes killed all 346 people aboard. These accidents have been attributed to issues with the flight’s Maneuvering Characteristics Augmentation System (MCAS) software.
The aircraft has been grounded globally for the past nine months and awaits approval from the Federal Aviation Administration (FAA) to return to service. The Max’s development remains under investigation by the U.S. Department of Justice and Congress.
The months-long grounding of the plane has led to thousands of flight cancelations for airlines around the world and billions of dollars worth of charges for Boeing. The Chicago, Illinois-based company last week announced it would be halting production of the 737 Max starting in January.
Monday’s announcement marks the latest in a series of executive changes for Boeing amid the 737 Max developments. In October, the company replaced Kevin McAllister, its head of commercial aircraft division since 2016, with Stan Deal, who most recently led Boeing’s global services business.
Stakeholders, victims’ families and members of Congress have repeatedly called for Muilenburg’s resignation in the wake of the crashes even as the Board of Directors repeatedly stood behind its leader, a former Boeing engineer and CEO since July 2015. The Board removed Muilenburg from his position as Chairman of the Board in October and replaced him with Calhoun, in a move said at the time to be aimed at giving Muilenburg an opportunity to focus full-time on getting the 737 Max back to service.
“I strongly believe in the future of Boeing and the 737 Max,” Calhoun said in a statement Monday. “I am honored to lead this great company and the 150,000 dedicated employees who are working hard to create the future of aviation.”
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck
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