Boeing sacks CEO Dennis Muilenburg as company's struggle to return 737 Max to service continues

Dennis Muilenburg will step down immediately and be replaced by the company's board Chairman David L. Calhoun

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Boeing on Monday (December 23, 2019) fired its chief executive officer Dennis Muilenburg following a disastrous year that saw the aircraft maker face a series of setbacks. The company said it has replaced Muilenberg with current board Chairman David L. Calhoun, who will also serve as the president.

Boeing has been facing action from regulators for months now as its highest selling 737 Max remains grounded since March. The decision isn't surprising given that the company has failed to win back the faith of the regulators so far in bringing back the troubled jet.

Muilenburg's exit obvious

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Boeing said in a press statement said that its board of directors had decided to no longer continue with Muilenberg. Calhoun will take over as the new chief executive officer on January 13, 2020. Muilenberg, who is leaving the role almost immediately, will use the next few days to exit his non-Boeing commitments.

Boeing statement added: "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." Alongside Calhoun, board member Lawrence Kellner will now be the company's new nonexecutive chairman effective immediately.

Muilenberg took over as the Boeing CEO in 2015. He was previously holding the chairman's role also but gave up the post in October. Kellner's appointment as the nonexecutive chairman is a clear indication that the company wants to keep the roles of chairman and chief executive officer separate.

Boeing's crisis continues

Boeing 737-MAX. (File Photo: Boeing)
Boeing 737-MAX. (File Photo: Boeing) IANS

Muilenberg's exit is a direct effect of Boeing's mounting crisis. The aircraft maker's highest-selling 737 Max counties to remain grounded globally since March following two fatal crashes in Indonesia and Ethiopia that killed 346 people.

Boeing has been trying to get back the aircraft to service but has so far failed to win the confidence of the Federal Aviation Administration. This has seen airline companies across the world cancel thousands of 737 Max flights that now has gone into April 2020.

Boeing has been trying to address the problem and has also paid compensation to at least one of its customers, Southwest Airlines. Other airline companies too are negotiating with Boeing. The company has also put $100 million into a fund in a bid to distribute it to the families of victims of the air crashes. This has seen the company incur losses in millions of dollars. Now with no assurance on 737 Max's specific date of return, Boeing's crisis continues to escalate.