The chairman and chief executive of the world's largest aircraft manufacturer, Boeing, has resigned. His departure comes a week after Boeing's board ousted its chief financial officer for violating the company's ethics policy.
Under pressure from Boeing's board of directors, the company's chairman and chief executive officer, Phil Condit, announced his resignation in Chicago Monday. The 62-year-old Boeing veteran said he had offered his resignation in order to "put the distractions and controversies of the past year behind us."
Retired Vice Chairman Harry Stonecipher immediately assumed the job of president and chief executive. The changes come only a week after the firing of Boeing's chief financial officer, Michael Sears, for improperly recruiting a U.S. Air Force official who was involved in an $18 billion deal with Boeing. U.S. Secretary of Defense Donald Rumsfeld says the Pentagon is conducting an investigation and could drop the contract.
The Defense Department has been one of the areas providing Boeing a ready market, as the demand for commercial airliners worldwide fallen, in large part because of the terrorist attacks on September 11, 2001.
Investors and customers alike have viewed the turmoil at Boeing with some concern, but Richard Turgeon, director of research at Victory Capital Management in Cleveland, Ohio, says the shake-up was just what the company needed.
"I think this is a positive day for Boeing. I think that we have some direction with some people who are very familiar with the company, very familiar with the product mix of the company, the Pentagon, the end market, the customers. It is unfortunate that we have lost the CEO and the CFO over the course of ten days, but a fresh perspective is not always a bad thing," he said.
Mr. Turgeon, who follows Boeing closely as a stock analyst, says the company is slowly recovering from the drop in business caused by the terrorism threat. He says the change in leadership should also help the company hold its own against its main competition European consortium Airbus.
"Airbus is a very good competitor and it will continue to be a very good competitor for Boeing longer term, but from a fresh perspective point of view, I think Boeing is in a better position today than it was on Friday," he said.
Boeing stock dropped over one percent in trading Monday, but if Mr. Turgeon's optimistic outlook holds true, the company and its stock may fair much better in the weeks and months ahead.