Boeing CEO Calhoun took home $5M last year ahead of 737 Max crisis

Outgoing Boeing CEO Dave Calhoun’s take-home pay fell to $5 million last year after declining a bonus, compared with $7 million in 2022, and his latest compensation package is taking a hit from the prolonged safety crisis surrounding the company’s bestselling jetliner, the 737 Max.

Calhoun’s total compensation last year rose 45% to $32.8 million, up from $22.6 million in the prior year. But Boeing said the 2023 sum is closer to $25 million, as it includes long-term incentives such as stock.  Shares of the plane-maker are down almost 30% this year.

Total compensation for Stan Deal, whom Boeing last month replaced at the top of the commercial airplanes division, rose 42% to $12.5 million.

Calhoun last month said he would step down by the end of the year. His departure is part of a broad shake-up in which the company also replaced its chairman and head of its commercial airplane unit. The manufacturer is grappling with the fallout of a door plug panel that blew out midair from a 737 Max operated by Alaska Airlines in January.

Boeing disclosed the take-home pay, which did not include a 2023 bonus Calhoun declined that was valued at $2.8 million, and executive compensation in a filing Friday. The company said it will now more closely tie executive compensation to safety goals.

“I promise that I personally, and we as a Board, will leave no stone unturned in our efforts to get this company where it needs to be,” newly named Boeing Chairman Steve Mollenkopf said in a message to shareholders in a filing Friday.

The Jan. 5 accident has slowed deliveries of new jets and Boeing has said it will burn more cash than it previously expected. The company is scheduled to release first-quarter results April 24.

Calhoun took the helm at Boeing in January 2020 after his predecessor was ousted for his handling of the aftermath of two fatal crashes of the 737 Max. In addition to the Covid-19 pandemic’s devastating effect on the aviation industry, Boeing has also had a host of quality defects on its aircraft. Those have slowed deliveries of new planes to customers clamoring for fresh jets as travel snapped back, hurting Boeing’s cash flow.

The Alaska Airlines door plug near-catastrophe was the most serious issue since the crashes. The Justice Department is investigating the Alaska Airlines accident and the Federal Aviation Administration has capped Boeing’s 737 Max production until it signs off on Boeing’s quality control.

Boeing said on Friday that “operational performance metrics for all business units will be focused exclusively on quality and safety goals” this year and that long-term executive incentives could be reduced to zero if goals are not met.

Boeing last posted an annual profit in 2018.