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    Monday, December 23, 2019

    Boeing CEO Muilenburg Quits

    Boeing CEO Dennis Muilenburg, who has faced intense criticism for his handling of the 737 Max crisis, resigned effective immediately, the company announced Monday.

    The Max was grounded worldwide in March after the second of two crashes that killed a total of 346 people. Boeing had hoped to get the plane flying this year but announced recently that it would temporarily halt Max production next month.

    The announcement also came one day after Boeing's Starliner capsule landed in New Mexico following a difficult flight that saw mission managers scrambling to save the unmanned spacecraft.

    Board Chairman David Calhoun was named CEO and president effective Jan. 13. Chief Financial Officer Greg Smith will serve as interim CEO during the transition, the statement said.

    Board member Lawrence Kellner will become non-executive chairman of the board effective immediately.

    "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," Boeing said in a statement.

    Boeing will operate "with a renewed commitment to full transparency, including effective and proactive communication" with the FAA, other global regulators and its customers, the statement said.

    Boeing appeared confident last month that the FAA would certify its software fixes for the troubled plane this year and that it could resume deliveries of new Max planes to airlines in December, with the plane returning to commercial service in January.

    Calhoun even gave Muilenburg a vote of confidence in November, saying the board believed Muilenburg "has done everything right" during the Max crisis.

    The FAA, however, has repeatedly said there is no timetable for bringing the planes back into service. FAA administrator Steve Dickson recently chastised Muilenburg for repeatedly suggesting the plane would be recertified this year.

    Dickson was also concerned that some of Boeing's public statements on the plane's return were designed to force the FAA into taking quicker action. Dickson told Muilenburg that Boeing's focus should be on the "quality and timeliness of data'' submitted to the FAA for review ahead of any ungrounding.

    On Monday, the FAA said in a statement that it was informed of Muilenburg's departure from Boeing but said it does not comment on personnel decisions.

    Last week, United took the Max out of its schedule until early June, longer than any airline since the timetable for the plane's return remains murky. American and Southwest currently have it scheduled to return in early April.

    Two airline unions, the Association of Flight Attendants-CWA and Transportation Workers Union Local 556, called the resignation of Muilenburg "long overdue" in a statement issued by their leaders, who represent 70,000 flight attendants including those at United and Southwest airlines.

    “It is not right that the good people on the front lines of Boeing are hurting and facing uncertainty because of failed leadership," the statement said. "Our members are experiencing this same uncertainty as airlines jettison flight plans.''

    The planes were fast becoming the most popular in the world when Indonesia's Lion Air Flight 610 plunged into the Java Sea on Oct. 29, 2018, killing all 189 aboard. Less than five months later, on March 10, Ethiopian Airlines Flight 302 crashed minutes after takeoff from Addis Ababa, killing all 157 passengers and crew.
    Within days, nations around the world were grounding the Max planes. The U.S. was the last nation to order the planes out of the skies.

    On Monday, the father of Ethiopian Airlines crash victim Samya Rose Stumo, 24, issued a statement calling Muilenburg's resignation "a good first step." Michael Stumo urged several "board members who are underperforming or underqualified" to step down as well.

    Both flights crashed after experiencing drastic speed fluctuations during ascent, and their pilots tried to return to the ground after takeoff. Regulators and industry experts targeted the the plane's Maneuvering Characteristics Augmentation System, or MCAS.

    Boeing has been working feverishly to fix the problem and win certification to again fly the planes. The struggles to do so put pressure on Muilenburg, 55, who grew up on an Iowa farm and joined Boeing as an intern in 1985.

    Muilenburg was a career Boeing employee, named president of the aerospace and defense giant in 2013 and taking over as CEO in July 2015.

    Last month he agreed to give up any bonuses this year. His total compensation in 2018 was $23.4 million, according to Boeing's proxy statement. His salary was $1.7 million; the rest was bonus and stock awards.

    Calhoun said Monday he "strongly believes" in the future of Boeing and the 737 MAX.

    "I am honored to lead this great company and the 150,000 dedicated employees who are working hard to create the future of aviation," he said.
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