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Boeing CEO out immediately in shakeup over 737 Max struggles

By Clyde Hughes & Daniel Uria
Boeing CEO out immediately in shakeup over 737 Max struggles
Relatives hold photographs of those who died in two crashes of Boeing 737 Max aircraft as CEO Dennis Muilenburg testifies October 29 at a safety hearing on Capitol Hill. File Photo by Pete Marovich/UPI | License Photo

Dec. 23 (UPI) -- After trouble with a space mission and ongoing problems with its 737 Max, Boeing announced a leadership shakeup Monday that immediately replaces CEO Dennis Muilenburg.

The aviation giant said Muilenburg will be succeeded by Chairman David Calhoun effective immediately, and board member Lawrence Kellner will step in as chairman.

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Boeing also announced Chief Financial Officer Greg Smith will fill in as interim CEO until Calhoun fulfills non-company commitments. Muilenburg gave up his chairman title in October to focus on trouble with the 737 Max, which has been grounded since March while the company has worked on a fix to its automated flight software. A week ago, Boeing said it would suspend production of the model.

Boeing's board said Monday the leadership change was made to "restore confidence in the company moving forward," after continuing problems with the 737 Max. U.S. carriers that fly the plane have delayed its return to flight schedules for at least several months.

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"I am pleased that [Calhoun] has agreed to lead Boeing at this critical juncture," Kellner said in a statement. "Dave has deep industry experience and a proven track record of strong leadership, and he recognizes the challenges we must confront."

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"I strongly believe in the future of Boeing and the 737 Max," Calhoun added. "I am honored to lead this great company and the 150,000 dedicated employees who are working hard to create the future of aviation."

Former Boeing engineer and president of the International Federation of Professional and Technical Engineers, Paul Shearon, described the leadership changes as a "step in the right direction" for the company.

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"The Boeing Company has long been a world leader in both breakthrough engineering and the highest standards in aviation safety. Under Dennis Muilenberg that reputation for quality has been unquestionably tarnished," Shearon said. "The roughly 20,000 engineers and technical workers represented by our union at Boeing are committed to reestablishing Boeing's leading role in commercial aviation, defense and space flight. We look forward to working with the current chairman and incoming CEO David Calhoun."

Steve Dickson, chief administrator of the Federal Aviation Administration, said this month the Max would not be recertified to fly again this year.

Monday's shakeup also follows trouble with the launch Friday of Boeing's Starliner. During a critical test, the capsule failed to reach the International Space Station. The Starliner is designed to ferry NASA astronauts to and from space in the future.

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The unmanned craft was forced to return to Earth early when an error with the mission timer malfunctioned, causing the Starliner to burn too much fuel during an early orbital maneuver.

Boeing stock shot up 2.91 percent to $337.30 at the end of trading on Monday following the news.

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