The last few days at Boeing has been significant. From it’s new CEO appointment, to the very worrying financials, has this now caused the planemaker to finally begin a process of transformation & turnaround?
July 31 was when all of this information was distributed to the public, the industry, and the reflective media outlets within that.
Let’s take a look to see whether transformation and turnaround has begun at Boeing.
July 31: The Major Turning Point for Boeing?
July 31 saw a few developments arise from Boeing, which will be detailed in this overall arching theme of transformation and turnaround.
Their second-quarter results highlighted a $1.4bn net loss, attributed to lower commercial delivery volumes.
More costs have been attributed due to the safety issues that had occurred with their 737 MAX aircraft.
After they revealed their financial results, they also unveiled the appointment of their new CEO, Kelly Ortberg.
Ortberg has an extensive background in the aviation industry, holding positions such as the the President & CEO of Rockwell Collins.
Starting on August 8 and replacing Dave Calhoun, Ortberg said the following on his own appointment:
“I’m extremely honored and humbled to join this iconic company”.
“Boeing has a tremendous and rich history as a leader and pioneer in our industry, and I’m committed to working together with the more than 170,000 dedicated employees of the company to continue that tradition, with safety and quality at the forefront.”
“There is much work to be done, and I’m looking forward to getting started.”
The Board Chair Steve Mollenkopf seems very optimistic about his appointment, especially when it comes to safety:
“We look forward to working with Kelly as he leads Boeing through this consequential period in our long history.”
“Finally, I’d like to thank each of you for your hard work and dedication to Boeing.”
“I am fully confident in our company’s future and that we are taking the right actions to strengthen safety and quality for the company, our customers, and our industry.”
Will The Focus of Safety vs. Profitability Continue Moving Forwards?
A big theme of criticism applied to Boeing has been the prioritisation of profit over safety, which is something Boeing has been known for.
In their golden era, the American planemaker built strong, safe and reliable aircraft.
In the last few years with the 737 MAX crisis and the Alaska Airlines door plug blowout, this has somewhat changed.
However, whilst better late than never, the new CEO Kelly Ortberg has understood this assignment from the day of his appointment.
As per The Seattle Times, Ortberg has decided to be based in Seattle, rather than at the HQ in Arlington.
This has been seen as a major gesture towards the workforce.
A lot of criticism over moving to Arlington was that the executives were not on the ground watching.
However, it is clear that under the guise of Ortberg, the executives will be on the ground, which is a very good thing.
This decision has been welcomed by those in the industry, as well as in the political arena too.
Whilst this appears to be a change of tact from outgoing CEO Calhoun, it is still early days.
Furthermore, it was also revealed that Calhoun would remain a special advisor to the Boeing board until March 2025.
That could be a problematic aspect if Calhoun does influence decision-making amongst the board.
But even then, it is down to the strength of Ortberg to try and battle against that.
Arguably, as well as Dennis Muilenberg, Calhoun has contributed to the issues at the American planemaker.
This Will Be A Long Process…
In conclusion, whilst such announcements have been welcomed, this will still be a long process for Boeing.
However, July 31 does look to be a significant date for the carrier.
A new era with safety and transformation at the forefront of this.
Looking ahead, all eyes will be on Ortberg’s first moves at the planemaker when he begins work on August 8.
The initial signs do look to offer a view of the new beginning in transformation and a positive attitude to safety.
Boeing has some big work to do, of which some of these aspects are things like:
– Certification of the 777X.
– Certification of the MAX 7 and MAX 10.
– Finalising the acquisition of Spirit AeroSystems.
It remains clear here that there are a lot of opportunities to make up ground following everything that has transpired.
Overall, it’s whether the planemaker will take advantage of those opportunities or not.
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