Boeing CEO Dave Calhoun is set to address a Senate panel, acknowledging that the company’s culture is “far from perfect” amid new whistleblower allegations concerning the mishandling of defective parts. Calhoun, who plans to step down by the end of the year, will face the Senate Permanent Subcommittee on Investigations as Boeing strives to enhance employee training, aircraft quality, and its safety reputation. Boeing has not yet named a successor for Calhoun, who succeeded a predecessor ousted after two fatal crashes involving Boeing aircraft.
In his written testimony, Calhoun will assert that Boeing is making progress in addressing cultural and operational issues. The subcommittee released new claims from whistleblower Sam Mohawk, a quality assurance investigator, alleging that Boeing lost track of damaged or substandard parts, which were likely installed on airplanes. These parts were located in Boeing’s Renton, Washington, plant, where the 737 Max is manufactured.
Mohawk claimed he faced retaliation and was instructed by supervisors to conceal evidence from the Federal Aviation Administration (FAA). According to a memo, dozens of crucial parts, including rudders, winglets, and stabilizers, were stored outside during an FAA inspection. Boeing’s spokesperson confirmed receipt of the claims and stated that the company is reviewing them, emphasizing their commitment to safety.
The FAA reported an increase in reports from Boeing staff since a door-plug incident in January, and the agency investigates all allegations thoroughly. The new whistleblower claims add to Boeing’s ongoing challenges, including potential prosecution by the Justice Department for violating a 2021 settlement related to the 737 Max crashes in 2018 and 2019, which resulted in 346 deaths. The settlement protected Boeing and its executives from criminal charges, but this protection could be revoked following the recent door panel blowout on an Alaska Airlines plane.
Senator Richard Blumenthal, the subcommittee’s chairman, emphasized the need for accountability, stating that Boeing had promised to overhaul its safety practices, a promise he believes remains unfulfilled. The FAA has taken a stringent stance against Boeing, with Administrator Mike Whitaker pledging to maintain inspectors at Boeing facilities until safety improvements are satisfactory. The FAA has also halted Boeing’s production increase for the 737 Max, a restriction expected to last several months.
Boeing’s production issues have impacted major customers like Southwest Airlines and United Airlines, forcing them to adjust their growth plans. The crisis has strained Boeing’s cash flow, with the company warning investors of negative cash generation this year. Boeing’s stock has fallen over 30% this year, compared to a nearly 15% gain in the S&P 500.
Additionally, Boeing faces supply chain challenges, including issues with Spirit AeroSystems, which reported falsified documents for titanium. Despite these documents, tests confirmed the material met airplane-grade standards. Boeing is also in the process of acquiring fuselage supplier Spirit, with the deal expected to close in the first half of the year.
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