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Boeing’s “board now leans towards moving headquarters away from its current location in Arlington, Va., and back to the Seattle area”

Home Articles Boeing’s “board now leans towards moving headquarters away from its current location in Arlington, Va., and back to the Seattle area”

Boeing’s “board now leans towards moving headquarters away from its current location in Arlington, Va., and back to the Seattle area”

By Shawn Tully, Fortune

The most crucial CEO search in decades just took a pivotal turn: David Gitlin exited the race for the top job at the Boeing Co. From this writer’s reporting, Gitlin—chief of heating and ventilation giant Carrier Global and a Boeing director since mid-2022—was far and away the frontrunner to lead the embattled manufacturer. Gitlin’s long career in aerospace at United Technologies Corp., his status as an outsider, his relative youth (he’s 54) that potentially gave him a long run at the controls, and his success in multiplying Carrier’s share price five-fold since its public debut in 2020, made him an ideal candidate, and the Boeing board’s favourite.

But on the Carrier Q1 earnings call that began at 7:30 AM EST on April 25, Gitlin definitively nixed any possibility he’d head the fabled, over century-old plane maker, declaring that “I’ve notified both our board and the Boeing board that…I’ve given my commitment to Carrier [and] removed my name from consideration as a potential CEO of Boeing.”

That same day, Boeing’s current CEO David Calhoun, expressed strong support for the top internal candidate, Stephanie Pope. In December of last year, the board chose Pope as its new chief operating officer. Four days after she officially ascended on January 1, the notorious 737-9 Max door-plug blowout on Air Alaska flight 1282 over Portland tanked Boeing’s share price, and forced management and the board to acknowledge deep-seated flaws in its manufacturing processes and procedures. On March 25, Boeing unveiled a sweeping shakeup at the top: Calhoun announced his departure at the close of 2024, former Qualcomm CEO Steve Mollenkopf became the new chairman, and Stan Deal, head of the Boeing Commercial Airplanes division (BCA), abruptly retired. The board named Pope to replace her previous mentor Deal as CEO of BCA, adding the job of running its troubled day-to-day operations to her position as COO.

Pope’s appointment as COO late last year appeared to make sense. At the time, Boeing’s aircraft deliveries were rebounding strongly following the collapse triggered by the Lion Air and Ethiopian Airlines crashes, in 2018 and 2019 respectively, the killed 346 passengers and crew. Pope spent most of her Boeing career in top financial jobs, serving as CFO of both its services arm, and BCA. Her skills as a seasoned general manager featuring an excellent record in expense controls appeared a good fit—so long as the Boeing production machine worked smoothly.

But the January 5 disaster totally shifted Boeing’s direction in mid-air. The top priority turned to fixing the kinds of quality gaffes that caused the blowout heard round the world. Pope had never before served in a position directly overseeing manufacturing. It baffled many aerospace insiders and investors that the board would give a star in financial management what would seem a production-specialist’s task: Rallying the wrench-turners and mechanics to rework the flawed practices on the factory floor.

 

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