Boeing needs more hands-on management, not resignations -Ryanair CEO

By Joanna Plucinska

LONDON (Reuters) -Ryanair Chief Executive Michael O’Leary on Tuesday called for a revamp of Boeing (NYSE:) management after the mid-air blowout of a cabin panel in an Alaska Airlines 737 MAX 9, but said senior leaders should stay.

O’Leary, whose airline is one of Boeing’s largest customers with hundreds of MAX aircraft on order, told a news conference that Boeing CEO Dave Calhoun and its chief financial officer had his “full confidence and support.”

But he later told Reuters that Boeing needed more hands-on management at its production hub in Seattle to improve quality control and oversight through the whole manufacturing process.

O’Leary added the head of Boeing Commercial Airplanes, Stan Deal, was mostly a “sales guy” and that Boeing needed leadership present at its Seattle area production facility every day.

“When Stan is travelling – and he does a lot of travelling – who is minding the shop in Seattle?” O’Leary said. “We need somebody in Seattle cracking heads, ensuring quality, making sure that aircraft are rolling off the production line on the day they’re supposed to roll off the production line.”

Boeing referred to a letter to employees written by Deal on Monday, where he laid out additional steps the company would take to improve quality assurance, including additional 737 inspections at Boeing facilities in the Seattle region and at supplier Spirit AeroSystems in Wichita, Kansas. The company will also open its facilities to allow airlines to inspect 737s and review quality procedures.

“Since 2019, we have increased the number of Commercial Airplanes quality inspectors by 20% and we plan to make more investments in the Quality function,” Deal said.

Calhoun, who has led the company since 2020, told employees last week that the company had to ensure an accident like the door plug blowout “can never happen again”.

Analysts have said ongoing MAX 9 investigations could ratchet up the pressure for management changes among Boeing’s top executives.

“We would not be surprised to see regulators, investors and customers push for a turnover in the ranks of senior management and the Board of Directors,” Bank of America (NYSE:)’s Ron Epstein said in a Tuesday morning note to investors.

But O’Leary said there was no one to replace Calhoun in the short term and current senior management should remain for 12 to 18 months to deliver on safety and quality.

“I’m not calling for anybody’s resignation,” he said.

O’Leary also said he would like to see Boeing’s corporate office moved back to Seattle from Arlington, Virginia. The headquarters for Boeing’s commercial airplanes division is in Seattle.

He added that, for the past two years, Ryanair (LON:) had been calling for Boeing to increase numbers of quality control engineers and that it had promised to do so last week.

O’Leary also said Ryanair had seen a marked improvement in the quality of aircraft deliveries from Boeing, with fewer defects in recent months.