After months of speculation, former Rockwell Collins CEO Kelly Ortberg has been appointed as the new CEO of Boeing, tasked with steering the embattled plane maker through its biggest crisis in the company’s history. Boeing is reeling from a series of incidents involving its 737 Max aircraft, resulting in multi-year low stock prices and billions of dollars in losses.
Boeing has been struggling to recover since January when a door panel blew off a 737 Max during a commercial flight, leading to some passenger injuries but no fatalities. This accident brought back memories of the twin fatal crashes that occurred in 2018 and 2019.
Ortberg is an experienced leader with a reputation for building strong teams and running complex engineering and manufacturing companies. Boeing’s Chair, Steven Mollenkopf, led the search for Calhoun’s replacement and believes Ortberg possesses the right skills to lead Boeing in its next chapter.
Before joining Rockwell Collins as a programme manager in 1983, Ortberg began his career as an engineer at Texas Instruments. He has been widely supported by many within the industry who have advocated for an engineer to take on the top job at Boeing. Critics argue that the company prioritized shareholder returns and Diversity, Equity, and Inclusion (DEI) initiatives over investment in engineering and innovation.
As CEO of Rockwell Collins, which manufactures avionics and cabin equipment, Ortberg helped oversee its $30bn tie-up with United Technologies in 2017, now known as Collins Aerospace and part of defense contractor RTX. He is expected to face immediate pressure to restore confidence in the quality and safety of Boeing’s manufacturing operations while finding ways to ease the supply chain strains that have plagued the industry since the COVID-19 pandemic began.
Boeing’s airline customers have been angered by delays in plane deliveries during a period when rival Airbus has won market share. Analyst Rob Stallard at Vertical Research Partners believes Ortberg is a “very good hire,” noting his previous experience as CEO of Rockwell Collins and his strong corporate culture.
However, not everything is smooth sailing for the new CEO. Boeing pleaded guilty on July 24 to a felony fraud charge for misleading the US Federal Aviation Administration. The company recorded a $244 million charge in the second quarter tied to the penalty it expects to pay. Despite this, many believe that with Kelly as CEO, there is at least a chance of fixing Boeing’s numerous problems and returning to its core engineering roots.
