Just two days before Christmas, on December 23, 2019, Boeing announced that effective immediately, Dennis Muilenburg stepped down from his role as the company’s Chief Executive Officer and Board director. He will be temporarily replaced by the current Chief Financial Officer, Greg Smith. On January 13, 2020, David Calhoun will become the long-standing CEO and President of the company.
The move comes as the 737 MAX crisis has deepened over the past few weeks. Boeing hoped for the MAX to be certified just as 2019 ended, however, the Federal Aviation Administration’s Administrator, Stephen Dickson publicly shut down the idea, slipping the timeline of return to possibly Q2 2020, which would mark a full year when not a single 737 MAX flew commercially. The type has been grounded worldwide since March 2019, when the second Boeing’s state-of-the-art narrow-body crashed in Ethiopia.
The possibility of a prolonged grounding has prompted the manufacturer to take action and to completely suspend the production of the 737 MAX from January 2020, as Boeing is running out of space to where to store the aircraft and is also massively burning cash while producing the type. The company cannot recuperate the costs of production, as airlines pay for the aircraft upon delivery.
Airlines, on the other hand, are even less hopeful. United Airlines pulled the aircraft out of schedules until June 4, 2020. United was one of the three airlines in the United States to operate the now-troubled type, including American Airlines (A1G) (AAL) and Southwest Airlines (LUV) .
“I strongly believe 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,” said the newly appointed CEO and President, Calhoun, who joined Boeing in 2009.