Boeing looks from within to select its new CEO

Boeing Co. will have a new top executive starting next month, and it’s someone from within the company.

The Chicago-based company said Tuesday that Dennis Muilenburg was elected by Boeing’s board of directors to become CEO, effective July 1. Muilenburg, 51, has been president and chief operating officer of the company since 2013.

He replaces Jim McNerney as CEO and will retain the title of president. McNerney, 65, will remain Boeing’s chairman.

“The opportunity to lead the people of Boeing in service to our commercial and government customers is a tremendous honor and responsibility,” Muilenburg said in a Boeing news release. “Our company is financially strong and well positioned in our markets.”

McNerney joined Boeing’s board in 2001 and was named its CEO in 2005. He came to Boeing from 3M Co., where he was the Minnesota-based consumer and commercial product manufacturer’s chief executive.

McNerney was Boeing’s first CEO hire outside the company, replacing Harry Stonecipher, who was forced from his post after admitting an affair with a female Boeing executive. Stonecipher and his predecessor, Phil Condit, both came to the Boeing CEO job from within the company, though Stonecipher came to Boeing from its 1997 acquisition of the former McDonnell Douglas Corp.

Muilenburg is a 30-year veteran of Boeing and has a bachelor’s degree in aerospace engineering from Iowa State University and a master’s degree in aeronautics and astronautics from the University of Washington. He joined Boeing in Seattle in 1985 as an engineering intern.

Boeing Commercial Airplanes is an important customer to Wichita’s Spirit AeroSystems, which builds major components for all of Boeing’s jetliners, including the fuselage of its top-selling 737.

One analyst lauded Muilenburg’s appointment to CEO.

“Over time … we’d expect Dennis to be tackling some of the tougher issues – for example the 777 rate, a 757 replacement, perhaps some portfolio actions in Defense,” RBC Capital Markets analyst Robert Stallard wrote in a research note to investors Tuesday afternoon. “These may be viewed as ‘negative’ in the short term, as they would likely dent the uber bullish tale on cash generation and deployment.

“But longer term they are arguably the calls that need to be made, and in our view could be healthier for Boeing’s longer term growth and success. Other more subtle changes, such as on communication and tone, would also be helpful, in our view.”

Boeing also said Tuesday that Ray Conner, Boeing Commercial Airplanes president and CEO, will remain as Boeing Co. vice chairman, a title he has shared with Muilenburg since 2013. Conner, 60, remains in charge of the $60 billion commercial airplanes business and will serve as sole company vice chairman.

This story was originally published June 23, 2015 at 4:54 PM with the headline "Boeing looks from within to select its new CEO."