Boeing CEO Dave Calhoun faced scrutiny from lawmakers on Capitol Hill for the first time earlier this week, addressing numerous safety concerns and management issues under his leadership. While many observers believed Calhoun would take responsibility for the company’s numerous alleged safety lapses, the Boeing CEO instead struck a defiant tone, claiming he is proud of the company’s safety record.
During a Senate hearing on Tuesday, Calhoun expressed regret for Boeing’s errors that led to fatal airline crashes and acknowledged the company’s need to restore public trust. However, he consistently avoided taking direct personal responsibility. Calhoun also defended Boeing’s safety culture, expressing pride in the company’s actions in response to the safety lapses.
HAWLEY VERSUS CALHOUN.
When questioned by Senator Josh Hawley (R-MO) about receiving a lucrative raise despite Boeing’s poor financial performance and calls for his resignation, Calhoun maintained his commitment to seeing his term through. The Boeing CEO secured a 45 percent raise for himself contrasted with a 1 percent increase for machinists over eight years. Calhoun’s salary is north of $20 million annually, and he will receive a $45 million severance package when he retires later this year.
This response and his repeated inability to provide clear answers about company policies and safety accountability drew criticism from lawmakers. Hawley specifically accused him of deflecting blame onto employees rather than management.
LACK OF COMPETITION & SAFETY.
Regulatory attention heightened sharply following an incident on January 5, when a Boeing jet’s door plug detached shortly after takeoff. The aviation industry’s limited competition—often described as a duopoly between Boeing and Airbus—means airlines have minimal flexibility to switch manufacturers without substantial costs and retraining. Consequently, customer dissatisfaction has little impact on Boeing’s market position. Public outcry also appears to have minimal effect on the company’s operations.
The Federal Aviation Administration (FAA) is reviewing Boeing’s submitted plans to address its safety issues, and the Justice Department (DOJ) has initiated a criminal investigation into the January incident.
