Graphic: Boeing CEO Calhoun's exit leaves uphill task for successor

General Electric Co

26/03/2024 16:08

By Shivansh Tiwary and Nathan Gomes
       March 26 (Reuters) - Boeing  BA.N  CEO David Calhoun
will leave the troubled aircraft maker at the end of the year,
leaving a difficult turnaround job to his yet-to-be-named
successor.
    Calhoun - a veteran crisis manager - was hired in 2020 to
steer the planemaker out of a reputation setback after crashes
in 2018 and 2019 killed nearly 350 people and caused the
grounding of its best-selling 737 MAX jet.
    But his tenure might not join the list of his successful
earlier stints including at Caterpillar  CAT.N , General
Electric  GE.N  and media company Nielsen, leaving when the
iconic planemaker is struggling to resolve production issues and
safety concerns.
    The Jan. 5 mid-air panel blowout was the most recent in a
spate of safety issues that have shaken the industry's
confidence in Boeing and hampered its ability to increase
production to meet high demand for jets.
    
COMPETITION 
    Under Calhoun's leadership, the company has struggled to
keep pace with competitor Airbus  AIR.PA .
    Boeing stock has lost 43% of its value since Calhoun took
the top job on Jan. 13, 2020, underperforming the benchmark S&P
500 index.  .SPX 
    Rival Airbus added more than 26% to its market cap during
the same period.

    While both planemakers have received bumper orders for their
jets as airlines try to cater to a post-pandemic travel boom,
Boeing's production and quality issues have frustrated
customers. 
    Airbus, meanwhile, has been steadily growing single-aisle
market share with its A320 jet family in the wake of multiple
crises involving the MAX.

    There have, however, been some bright spots. 
    The Arlington, Virginia-based planemaker's revenue has edged
past Airbus over the past four years. 

    
    Airbus and Boeing reported a negative cash flow in 2020 as
the COVID-19 pandemic brought the sector to a halt after
restrictions across the world dented demand for air travel and,
thus, new airplanes. 
    Airbus experienced better cash flow performance in 2021 and
2022. Boeing performed better in the last year and 2020. 
    However, Boeing expects to burn more cash than expected in
the current quarter as fewer deliveries, lower production
volumes at its commercial division and pressure on working
capital affect its free cash flow.
    

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Instant view: Boeing CEO to step down in management shakeup   
[https://www.reuters.com/business/aerospace-defense/view-boeing-ceo-step-down-management-shakeup-2024-03-25/
]
FACTBOX-Boeing's tumultuous four years under outgoing CEO
Calhoun     urn:newsml:reuters.com:*:nL3N3G32U0
Boeing and Airbus annual revenues over the years Boeing and
Airbus annual revenues over the years    [https://reut.rs/3IUq0sy
]
Boeing shares have lagged Airbus and the S&P 500    [https://reut.rs/43BIdos
]
Boeing, Airbus deliveries & orders over the past four years
Boeing, Airbus deliveries & orders over the past four years   
[https://reut.rs/4csZ2pn
]
Boeing may turn to outsider CEO to tackle spiraling crisis    [https://www.reuters.com/business/aerospace-defense/boeing-may-turn-outsider-ceo-tackle-spiraling-crisis-2024-03-26/
]
Boeing and Airbus free cash flow since 2020 Boeing and Airbus
free cash flow since 2020    [https://reut.rs/3TSBkMf
]
Boeing and Airbus free cash flow since 2020 Boeing and Airbus
free cash flow since 2020    [https://reut.rs/49hfExr
]
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 (Reporting by Shivansh Tiwary and Nathan Gomes in Bengaluru;
editing by Arpan Varghese and Sriraj Kalluvila)
 ((Shivansh.Tiwary@thomsonreuters.com; +91 9708363192;))