Boeing Replaces Leadership of Defense and Space Division Following Crises

Boeing is in crisis due to technical problems and significant cost overruns.

9/25/2024, 8:00 AM
Eulerpool News Sep 25, 2024, 8:00 AM

The US aircraft manufacturer Boeing is once again in the spotlight after the company has experienced significant problems in both its civilian and military, as well as space-related businesses. Ted Colbert, the previous head of the defense and space division, will be leaving the company, as the new CEO Kelly Ortberg announced in an internal email. Steve Parker, the division's current operational manager, will temporarily take over leadership.

The decision follows a series of setbacks in important projects, including the "Starliner" spacecraft. During the first manned test flight of the capsule, technical problems occurred, leading to a safe but unmanned return to Earth. The "Starliner," which was originally supposed to bring astronauts to the International Space Station (ISS), had to abort its mission, damaging Boeing's reputation in the space industry. NASA is now temporarily relying on the competing model "Crew Dragon" from SpaceX.

In addition, Boeing's defense and space division is struggling with further challenges, such as high cost overruns for converting two Boeing 747s into new presidential aircraft for the US government and the overpriced KC-46 tanker. In the past quarter, the division recorded an operating loss of one billion USD, and the outlook for the current quarter remains bleak as well.

Boeing is also facing another major test: The company's largest union, IAM, is striking with around 33,000 workers. The strike is paralyzing the production of important models such as the 737 and the long-haul 777. Boeing recently offered the striking employees a 30 percent wage increase, but the union continues to demand 40 percent and has rejected a deadline to accept the offer.

Boeing shares rose 1.96 percent to $156.30 on Monday but fell 0.74 percent to $155.15 in early trading on Tuesday.

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