David Calhoun will take over as Boeing's new chief executive on Monday, as the aircraft maker continues to grapple with its 737 Max crisis. Calhoun takes over from the company's ousted chief executive Dennis Muilenburg. Needless to say, Calhoun has an upheaval task ahead of him that includes bringing back the ground 737 Max to service.
Boeing has been mired in controversy for almost a year now and this is taking a toll on its profits. Calhoun's biggest challenge will be resurrect the image of the company and look at all possible avenues to for the company so that bounces back from its present situation.
Big challenge for Calhoun
Sixty-two-year-old Calhoun was announced the chairman of Boeing in October after Muilenburg was removed from the post. On December 23, Boeing named Calhoun as its new chief executive, following the firing of Muilenburg amid growing concerns of the company with the Federal regulators in regard to return of the troubled 737 Max to service.
Calhoun comes with a lot of experience and had earlier headed a division in General Electric that included airplane engines. He is already working on repairing the company's relationship with regulators, its suppliers and airline companies.
Can Calhoun save Boeing?
Boeing's crisis has been on the rise and there seems to be no respite for the company. The company has been struggling hard to get its best-selling 737 Max to service since grounding in March following two fatal crashes in Indonesia and Ethiopia that killed 346 people. Over the past few months Boeing under the leadership of Muilenburg has tried its best to get the flight back to service but have instead soured its relationship with the regulators.
In December, the US Federal Aviation Administration said that it will take its own time to review the aircraft. With no timeline for the jet to return, Boeing late last year said that it will halt production of 737 Max from January. So far, Boeing has estimated costs of more than $9 billion till date owing to the grounding of the aircraft. This includes playing compensation to a number of airline companies, which have been cancelling all their 737 Max flights well until April.
A lot now depends on Calhoun to fix these problems. Last week, Boeing's board approved $1.4 million salary for Calhoun. Besides, it also approved a long-term compensation package of $26.5 million provided he succeeds in achieving the company's goals that also includes returning 737 Max to service.