Boeing CEO Dave Calhoun’s compensation package has taken a hit due to the ongoing crisis surrounding the company’s 737 Max jetliner. Calhoun’s take-home pay for last year fell to $5 million after declining a bonus, compared to $7 million the previous year. However, his total compensation rose to $32.8 million, up from $22.6 million in the prior year, when including long-term incentives such as stock.
The prolonged safety crisis surrounding the 737 Max has impacted Boeing’s stock performance, with shares down almost 30% this year. This has had a direct effect on Calhoun’s compensation package, as it includes stock-based incentives. Additionally, the recent door plug panel incident involving an Alaska Airlines 737 Max has further complicated matters for Boeing.
Stan Deal, who was recently replaced as the head of Boeing’s commercial airplanes division, saw his total compensation rise by 42% to $12.5 million. These changes in compensation come as part of a broader shake-up within the company, which also included replacing the chairman and head of the commercial airplane unit.
Boeing has stated that it will now closely tie executive compensation to safety goals, in response to the ongoing safety concerns surrounding its aircraft. This move reflects the company’s commitment to addressing these issues and ensuring that they do not happen again in the future.
The impact of the 737 Max crisis has been significant for Boeing, leading to a slowdown in deliveries of new jets and increased cash burn. The company is set to release its first-quarter results on April 24, which will provide more insight into the financial implications of the crisis.
Dave Calhoun took over as Boeing CEO in January 2020, following the ousting of his predecessor due to mishandling the aftermath of two fatal crashes involving the 737 Max. Since then, Boeing has faced numerous challenges, including the devastating effects of the Covid-19 pandemic on the aviation industry and a series of quality defects on its aircraft.
Boeing’s focus on safety and quality control has intensified following the Alaska Airlines incident. The company has stated that operational performance metrics for all business units will be exclusively focused on safety and quality goals this year. Additionally, long-term executive incentives could be reduced to zero if these goals are not met.
Overall, Boeing’s CEO Dave Calhoun’s compensation package has been impacted by the ongoing crisis surrounding the 737 Max jetliner. The company’s commitment to addressing safety concerns and improving its operational performance will be crucial in restoring investor confidence and ensuring a successful future for the aerospace giant.
