More change at Boeing

  • By Michelle Dunlop Herald Writer
  • Monday, August 31, 2009 10:55pm
  • BusinessEverett

EVERETT — The face of Boeing Commercial Airplanes will change today as division president Scott Carson steps down and the company’s defense chief steps up.

Carson, 63, will retire at the end of 2009 but will work with incoming Commercial Airplanes chief Jim Albaugh on projects for the remainder of the year, Boeing said Monday. Albaugh has served as the CEO of Boeing’s Integrated Defense Systems in St. Louis since 2002. Carson’s retirement announcement comes on the heels of the company’s latest schedule revision for its delayed 787 Dreamliner.

“My decision is tied to many factors, but perhaps the most important reason for me was resetting the schedule on the 787,” Carson wrote in a message to employees. “With this baseline in place, the new leader will have a clear path forward.”

But Jim McNerney, Boeing’s chief executive, cut off speculation that Carson was forced out.

“The decision to retire was Scott’s,” McNerney said.

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Carson’s departure also comes as local and state lawmakers fret over the company’s future in the state, especially after Boeing filed for permits to expand its recently acquired 787 supplier facility in South Carolina. At an aerospace conference in early August, several politicians lauded Carson’s dedication to the Puget Sound region. On Monday, state Sen. Mike Hewitt, R-Walla Walla, said Carson’s retirement will hurt Washington’s chances of keeping Boeing jobs in the state.

“Scott was a homegrown CEO with strong ties to our state,” Hewitt said in a statement. “Even though the new CEO is also from Washington, no one should count on that as ensuring Boeing’s ongoing presence in our state.”

In a memo to employees, Albaugh, 59, talked up his connections to the Puget Sound region, crediting the area’s workers for both commercial airplane and military jet progress. Albaugh graduated from Richland High School and started his aerospace career at the company’s operations in Hanford in 1975.

Albaugh will inherit not only the company’s troubled 787 program but also its 747-8 aircraft, an updated version of Boeing’s jumbo jet that also is set to make its first flight later this year. McNerney said Albaugh has a “working knowledge” of the 787, a mostly composite jet that has been delayed more than two years. Although Albaugh lacks substantial commercial airplanes experience, McNerney called Albaugh a “seasoned” aerospace executive who “does not require a lot of hand-holding.”

Still some analysts were not reassured by McNerney’s pick.

“We are not convinced that this move improves the situation” at Boeing Commercial Airplanes, Rob Stallard, an analyst with Macquarie Securities, told Reuters.

Peter Jacobs, an analyst with Ragen MacKenzie, a division of Wells Fargo Investments, thought that Boeing would want to keep Albaugh, a solid and highly regarded leader, at the top of its defense business, which faces its own difficulties.

Albaugh also will shoulder the burden of improving division’s relationship with its unions — considered key in securing future Boeing work in Washington. He gave a nod to both Boeing’s engineers and machinists unions in a note to workers.

“In its soul, Boeing has always been and remains an engineering company. As an engineer I look forward to learning from and working with you,” Albaugh wrote. “The heart of this company is the skilled machinists, technicians and mechanics — true craftsmen and wizards — who deliver on their promises everyday.”

Both Boeing’s engineers and machinists unions said they hope to build a strong relationship with Albaugh.

Boeing said Dennis Muilenburg, president of its military support and services business, will succeed Albaugh as president and CEO of the company’s Integrated Defense Systems. A replacement for Muilenburg will be named at a later date.

Shares of Boeing dropped $1.37, or 2.7 percent, to close the regular session at $49.67. They dipped 2 cents in aftermarket trading. In the last 3 1/2 years, shares have fallen 29 percent.

The Associated Press contributed to this report.

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