### Boeing’s New CEO Vows to Transform Culture Amid Ongoing Challenges
As Boeing’s newly appointed CEO, **Kelly Ortberg** encounters an enormous challenge: guiding the aerospace powerhouse through one of its most turbulent eras. Since assuming leadership three months ago, Ortberg has faced a succession of crises that have left the company’s financial health compromised, its reputation damaged, and its workforce unsettled.
On Wednesday, Ortberg spoke to investors for the first time, sharing his strategy for stabilizing Boeing’s operations. His top priority, he noted, is to resolve an ongoing strike involving the company’s largest union. However, as the day unfolded, it became evident that almost two-thirds of union members had turned down Boeing’s latest contract proposal, prolonging the six-week strike. This ongoing labor dispute is costing Boeing approximately **$50 million each day**, further hindering aircraft production and intensifying supply chain difficulties.
### A Giant in Distress
Boeing, once a symbol of modern commercial aviation, has been engulfed in turmoil for much of the past five years. The company has suffered a string of high-profile incidents, including two tragic crashes involving its 737 Max jets, a global grounding of the aircraft, and a guilty plea to a criminal fraud charge. The COVID-19 pandemic, which halted global air travel, only heightened Boeing’s challenges. More recently, a component of a Boeing aircraft detached mid-flight, and now the corporation is contending with a strike that could disrupt its operations even further.
Bank of America analyst **Ron Epstein** compared Boeing’s predicament to the legendary Hydra: “For every issue that’s been addressed and cut away, new ones emerge.”
Addressing Boeing’s crisis is vital not just for the company but for the future of commercial aviation. Boeing and its European competitor **Airbus** hold a commanding share of the market for commercial passenger jets, yet Airbus has limited capacity to take on new clients until the 2030s. This situation places the immense burden on Boeing to reclaim its status as an industry leader.
### Ortberg’s Goal: Redirecting the Course
Ortberg, a 64-year-old Midwesterner with a mechanical engineering background, is well-acquainted with the aerospace sector. He previously led **Rockwell Collins**, a Boeing avionics supplier, before its acquisition by **United Technologies** in 2018. His engineering insights have been welcomed by many who feel that Boeing’s former leadership, focused primarily on shareholder profits, has overlooked the essential areas of engineering and manufacturing.
Ortberg’s objective, as he articulated, is “quite simple—steer this large vessel in the right direction and bring Boeing back to the leadership position we all recognize and desire.”
However, the hurdles ahead are substantial. Beyond resolving the machinists’ strike, Ortberg must rejuvenate a workforce that has been disheartened by layoffs and austerity measures. He must also regain the confidence of investors, many of whom are hesitant to support an equity raise in an industry where returns may take years to materialize.
### Addressing Manufacturing and Quality Challenges
A top priority for Ortberg is to tackle Boeing’s manufacturing and quality control dilemmas. The company’s clientele, including major airlines, have had to modify their schedules and reduce flights due to delays in aircraft deliveries. **Carsten Spohr**, CEO of **Lufthansa**, recently stated, “I’ve never witnessed anything like it in our industry, to be honest. I’ve been in the field for 30 years.”
Ortberg has also suggested that Boeing must consider introducing a new aircraft model to better compete with Airbus. Nevertheless, the timing for such a decision will be crucial, given that Boeing’s resources are already stretched thin.
### A Shift in Culture
Perhaps Ortberg’s most significant challenge is transforming Boeing’s corporate culture. Many long-standing employees attribute the current issues back to the 1997 merger with **McDonnell Douglas**. Under the leadership of **Phil Condit** and **Harry Stonecipher**, Boeing embraced a management style influenced by **Jack Welch**, the former CEO of **General Electric**, which prioritized financial engineering and cost reductions over innovation and quality.
This shift in priorities led to several decisions that many believe have contributed to Boeing’s ongoing crisis. For instance, former CEO **Jim McNerney** initiated a strategy to enhance profits by pressuring suppliers, a tactic that damaged relationships with crucial partners. McNerney also infamously remarked about employees “cowering” before him during a 2014 earnings call, a comment that continues to resonate with Boeing’s workforce today.
Ortberg has made it clear that he aims to take a different route. One of his initial significant actions as CEO was to move from his home in Florida to Seattle, the location of Boeing’s manufacturing facilities. He has also highlighted the necessity of being
