Boeing picks Muilenburg to succeed CEO McNerney, signals stability

Tue Jun 23, 2015 9:00pm EDT
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By Alwyn Scott

SEATTLE (Reuters) - Boeing Co (BA.N: Quote) said Tuesday that President Dennis Muilenburg will take over as chief executive officer July 1, a transition that comes as the aerospace giant tries to keep pace with an historic boom in the commercial jet market and build its defense business amid tight military budgets.

Muilenburg, 51, will succeed 65-year-old Jim McNerney, who picked Muilenburg as heir apparent in 2013.

Though the transition was expected, it comes as the world's largest plane maker is grappling with record demand for jetliners and weak military sales. It is speeding up its jetliner factories to unprecedented levels while introducing new jet models and overhauling production methods. It also is shuttering some military plane production, trying to keep other lines running and bidding for new arms contracts, notably a new long-range strike bomber.

Muilenburg, in an interview, signaled no new direction, and did not discuss defense as a challenge.

"The challenges we see are ramping up our production system on the commercial airplane side and doing that profitably," Muilenburg said.

After 18 months working with McNerney and commercial airplanes Chief Executive Officer Ray Conner, he said, "our path forward is one of consistency. You're going to see stability in our strategy and our execution."

But among the issues Muilenburg faces are how to continue squeezing margin out of suppliers while ensuring they can keep pace with increasing jet output, expected to top 750 this year.

Boeing is increasing production of its best-selling 737 jetliner to 52 a month in 2018 from 42 a month currently, while introducing the new 737 MAX.   Continued...

Dennis Muilenburg speaks during the Reuters Aerospace and Defense Roundtable in Washington September 4, 2012.REUTERS/Yuri Gripas