1-8-2024 (NEW YORK) In a pivotal move to steer the company through choppy skies, Boeing has named Robert Kelly Ortberg, the former head of Rockwell Collins, as its next Chief Executive Officer. The announcement comes as the aerospace giant grapples with ongoing operational challenges, reflected in a substantial financial loss reported in its latest quarterly results.
Ortberg, 64, who played a crucial role in leading Rockwell Collins and overseeing its integration into United Technology before his retirement from RTX in 2021, is set to take the helm on 8 August. His appointment arrives at a critical juncture for Boeing, as the company seeks to rebuild trust and overcome a series of safety and quality control issues that have placed it under intense scrutiny.
The severity of Boeing’s struggles was laid bare in its second-quarter financial report, released alongside the leadership announcement. The company posted a staggering loss of $1.4 billion, a significant deterioration from the $149 million loss recorded in the same period last year. Revenues also took a hit, falling 14.6% to $16.9 billion.
These disappointing figures underscore the persistent challenges in Boeing’s commercial division, where production rates have been scaled back to accommodate enhanced safety and quality control measures under close regulatory oversight. The company’s defence business also showed significant weakness, with an operating loss of $913 million attributed to four fixed-price contracts plagued by supply chain disruptions, escalating engineering costs, and technical hurdles.
The leadership shake-up comes in the wake of a January incident involving an Alaska Airlines 737 MAX, which was forced to make an emergency landing after a fuselage panel blew out mid-flight. This event reignited concerns about Boeing’s safety practices and prompted renewed scrutiny from lawmakers and airline customers alike.
Outgoing CEO Dave Calhoun, who took the reins in January 2020 following the ouster of his predecessor Dennis Muilenburg amidst the fallout from two fatal MAX crashes, had initially seemed set to continue until 2028. However, the Alaska Airlines incident precipitated his decision to step down by the end of 2024.
In selecting Ortberg, Boeing appears to have heeded calls for a leader with strong aerospace credentials and manufacturing experience. Boeing chairman Steve Mollenkopf praised Ortberg as “an experienced leader who is deeply respected in the aerospace industry” in a message to employees.
Ortberg expressed his enthusiasm for the role, stating, “I’m extremely honoured and humbled to join this iconic company. There is much work to be done, and I’m looking forward to getting started.”
The appointment has garnered cautious optimism from some quarters. Representative Rick Larsen, the senior Democrat on a key House Transportation Committee, noted on social media platform X that he was “encouraged” by the selection, highlighting Ortberg’s background as a mechanical engineer.
