Boeing names new CEO in effort to correct its culture
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Kelly Ortberg in 2016. Photo: Daniel Acker/Bloomberg via Getty Images
Boeing will be led by a new CEO, Kelly Ortberg, starting Aug. 8, the company announced Wednesday morning.
Why it matters: Ortberg, an outside hire and aerospace industry veteran, could lead to a crucial shift in Boeing's culture, which has been blamed for the numerous lapses in engineering safety over the past year.
Zoom in: When he was CEO of Rockwell Collins, one of Boeing's big suppliers, Ortberg had a reputation for regularly walking the production floor.
- In contrast, outgoing CEO Dave Calhoun — who previously served as an executive at the private equity firm Blackstone before taking over at Boeing in 2020 after the ouster of Dennis Muilenburg — has been criticized for reportedly retaliating against whistle-blowers who raised safety concerns.
Between the lines: Appointing Calhoun "who came out of a finance organization was not necessarily in line with what we were thinking the company should be doing," to turn itself around after the Max 8 disasters, Ron Epstein, senior aerospace and defense analyst at BofA Securities, told Axios in January after a portion of an Alaska Airlines aircraft flew off amid ascent.
- "There needs to be increased focus on the engineering culture of the company."
Today in a research note, Epstein wrote that he was "encouraged" by Boeing's decision to hire Kelly.
- "One person cannot turn around a company, but Kelly should be able to cast a wider net for talent than a Boeing insider could," he wrote.
- In that same research report Epstein also noted that Rockwell Collins "fostered a strong culture, something that we think Boeing is in dire need of now."
What we're watching: Calhoun is expected to stay on as a special advisor until March next year as Boeing faces a number of large hurdles, including a potential production strike in the fall, a decline in its defense business, and growing public and regulator scrutiny.
