Outgoing Boeing CEO Dave Calhoun’s pay fell to $5 million last year from $7 million in 2022 after forgoing a bonus, and his compensation package is taking a hit from the prolonged safety crisis surrounding the company’s best-selling jetliner, the 737 Max.
Calhoun last month said he would step down by the end of the year. His departure is part of a broad shakeup in which the company also replaced its chairman and head of its commercial airplane unit. The manufacturer is grappling with the fallout of a door plug panel that blew out midair from a 737 Max operated by Alaska Airlines in January.
Boeing disclosed the take-home pay and executive compensation in a filing on Friday. The company said it will now more closely tie executive compensation to safety goals.
“I promise that I personally, and we as a Board, will leave no stone unturned in our efforts to get this company where it needs to be,” newly-named Boeing Chairman Steve Mollenkopf said in a message to shareholders in a filing on Friday.
Boeing said Friday that Calhoun’s total compensation rose to nearly $32.78 million last year from $22.6 million, but that the 2023 sum is closer to $25 million, which includes long-term incentives.
Boeing shares are down nearly 30% this year, while the broader market is up. The Jan. 5 accident has slowed deliveries of new jets and Boeing has said it will burn more cash than it previously expected. The company is scheduled to release first-quarter results on April 24.
Calhoun took the helm at Boeing in January 2020 after his predecessor was ousted for his handling of the aftermath of two fatal crashes of the 737 Max. In addition to the Covid-19 pandemic’s devastating effect on the aviation industry, Boeing has also had a host of quality defect on its aircraft. Those have slowed deliveries of new planes to customers clamoring for fresh jets as travel snapped back and hurting Boeing’s cash flow.
The Alaska Airlines door plug near-catastrophe was the most serious issue since the crashes. The Justice Department is investigating the Alaska Airlines accident and the Federal Aviation Administration has capped Boeing’s 737 Max production until it signs off on Boeing’s quality control.
Boeing said on Friday that “operational performance metrics for all business units will be focused exclusively on quality and safety goals” this year and that long-term executive incentives could be reduced to zero if goals aren’t met.
Boeing last posted an annual profit in 2018.
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