| Boeing CEO out |
|||||||||||
| Condit follows CFO out the door a week after hiring scandal; top job split between two. |
|||||||||||
|
NEW YORK (CNN/Money) - Boeing Co. Chairman and CEO Phil Condit resigned Monday, a week after a hiring scandal led to the firing of its chief financial officer.
Condit will be succeeded as CEO by former McDonnell Douglas CEO Harry C. Stonecipher, who retired from Boeing last year. He had been president and chief operating officer of Boeing following its 1997 purchase of McDonnell Douglas. Lewis Platt, a former chairman and CEO of Hewlett-Packard, will serve as Boeing's non-executive chairman of the board. "The board appreciates that Phil acted with characteristic dignity and selflessness in recognizing that his resignation was for the good of the company," Platt said in a statement. On Nov. 24, Boeing fired Chief Financial Officer Michael Sears, saying he had discussed the hiring of a senior Air Force procurement official with her while she was still considering Boeing contracts. That executive, Darleen Druyun, also was dismissed from Boeing at that time. U.S. Defense Secretary Donald Rumsfeld subsequently announced a delay in signing a key contract with Boeing for 767 refueling tankers that already had been under fire from some members of congress.
The scrutiny now on Boeing due to the hiring scandal is the reason for Condit's early exit. "Boeing is taking this whole corporate governance thing very seriously," Banc of America defence analyst Nick Fothergill told Reuters. "They're proving to their prime customer -- the government -- that they have really taken this [scandal] in the most serious way possible by firing the CFO and the CEO resigning." But the defense scandal is not the only problem facing Boeing. The company this year lost its position as the world's largest maker of commercial jets to European consortium Airbus Industrie. Monday the company lost a $1.5 billion order for new jets being purchased by Australia's Qantas Airways Ltd., which had been a key Boeing customer in the past. The company also has been hurt by the sharp drop in demand for new commercial aircraft following the Sept. 11 terrorist attack, particularly among U.S. airlines, most of which have seen staggering losses since that time.
Boeing essentially has been able to remain in the black during this period, reporting only one quarterly loss in the spring of 2002. But its earnings for this year are expected to be significantly lower for the second straight year, off more than 70 percent from 2001 earnings. And this summer Boeing lowered its guidance for 2004 earnings and aircraft deliveries. Shares of Boeing (BA: down $0.48 to $37.91, Research, Estimates), a component of the Dow Jones industrial average, opened about 2 percent lower Monday following the announcement. Shares closed Friday up 16.4 percent for the year, but that is slightly behind the 17.3 percent rise in the Dow during that period. Shares are off 11 percent from the close immediately before the Sept. 11 terrorist attack. Reuters contributed to this story |
|||||||||||
|
--*Disclaimer |
|||||||||||
|
|
|||||||||||
