Boeing has shuffled the heads of three major divisions, replacing the retiring Scott Carson at Boeing Commercial Airplanes (BCA) with Jim Albuagh, his counterpart at Integrated Defense Systems (IDS).

The surprise move that becomes effective on 1 September comes after Carson's division has struggled with labour strikes and major programme delays with the 787 and 747-8 during this three-year tenure. Carson also presided over BCA's record-breaking year of 2007, when the division received orders for 1,413 airliners.

Carson's decision to retire was tied to the latest delay of the 787 programme, which is now running more than two years behind schedule.

"My decision is tied to many factors, but perhaps the most important reason for me was resetting the schedule on the 787," Carson wrote in an email sent today to employees. "With this baseline in place the new leader will have a clear path forward."

By naming Albaugh as Carson's replacement, Boeing shifts an executive whose career has been spent dominating the defence and space units that were acquired from Rockwell in 1996 and McDonnell Douglas in 1997. Albaugh will be succeeded at IDS by Dennis Muilenburg, who currently leads Boeing's Global Services and Support division.

Albaugh's "programme management and engineering focus will help ensure the success of BCA's key development and production programs," says James McNerney, Boeing president and CEO, adding, "He is the ideal leader for BCA at this time."

Muilenburg will take over an IDS division that rivals Lockheed Martin as the largest contractor for the Department of Defense (DOD). But the division has recently encountered several setbacks, including the initial loss of 767 tanker contract, which was overturned. The DOD has also recently sought to cancel the Future Combat Systems programme, which Muilenburg previously managed for Boeing, and plans to curtail further development of the 747-based YAL-1 Airborne Laser.

McNerney says that Muilenburg's "experience in technology integration; track record delivering large-scale programmess on time and budget; and work with customers in new, developing markets will help us generate new momentum and long-term growth".

Boeing has not named Muilenburg's replacement.

In a statement emailed today to BCA employees, Albaugh emphasized the division's heritage as an engineering powerhouse based in the Puget Sound area of Washington state.

"In its soul, Boeing has always been and remains an engineering company," Albaugh wrote. "As an engineer I look forward to learning from and working with you. The heart of this company is the skilled machinists, technicians and mechanics - true craftsmen and wizards - who deliver on their promises everyday. I look forward to understanding what you believe can be done to make the company even better still."'s Jon Ostrower contributed to this article.