Key Takeaways
- Boeing CEO Dave Calhoun testified before a Senate subcommittee over a number of safety issues, including whistleblower allegations released ahead of Tuesday’s hearing.
- A report released Tuesday by a Senate subcommittee included new allegations from a Boeing employee that the company lost track of damaged or unapproved parts.
- Boeing shares lost ground Tuesday and have lost nearly one-third of their value since the start of the year.
Shares of troubled airplane manufacturer Boeing (BA) fell 2% Tuesday as outgoing CEO Dave Calhoun testified before a Senate subcommittee over a number of safety issues, including new whistleblower allegations released ahead of Tuesday’s hearing.
Sen. Richard Blumenthal (D-Connecticut) said in Tuesday’s hearing that the Senate Permanent Subcommittee on Investigations has heard from more than a dozen Boeing whistleblowers since the January Alaska Airlines (ALK) flight on which a door plug detached from a Boeing Max 737, an incident that led to the grounding of the fleet and that sparked investigations from regulators and law enforcement.
Calhoun apologized to the hearing’s audience, which included family members of passengers and crew members killed in a pair of Boeing plane crashes in 2018 and 2019. He said Boeing’s company culture is “far from perfect,” and said the company is “taking action” to address concerns that have been raised by whistleblowers and regulators.
New Whistleblower Allegations of Lost Parts
The committee said ahead of Tuesday’s hearing that a new whistleblower has accused the company of losing track of damaged or subpar airplane parts during the manufacturing process, and that Boeing may have used some of those parts in the production process.
Lawmakers detailed a number of incidents in which whistleblowers said they faced retaliation against for raising concerns with Boeing’s safety and production practices. Calhoun said the company has disciplined and fired managers and executives who have been found to have retaliated against employees who raised issues, but couldn’t detail how often it has happened.
Calhoun was also pressed by Sen. Josh Hawley (R-Missouri) about how much money he is paid, and whether he feels he is worth his nearly $33 million salary given the safety issues and whistleblower complaints that have been reported this year.
Boeing Stock Extends Losses for 2024
Boeing has had a difficult year in 2024, starting with the Alaska Airlines door-plug incident in January that grounded the plane maker’s 737 Max fleet and hammered the company’s stock price. Boeing suspended its guidance for fiscal 2024 as it was forced to slow production while conducting safety investigations early this year.
Shares fell further as reports emerged that the Department of Justice (DOJ) was investigating the Alaska Airlines incident and interviewing crew members and passengers, informing them that they may be victims of a crime.
Boeing’s production and delivery metrics have suffered in recent months, and the company has made a number of changes at the executive level, including the announcement that Calhoun will step down by the end of 2024.
Boeing shares finished about 2% lower at $174.99 Tuesday, and have lost nearly one-third of their value so far this year.