Market confidence in Boeing soared late last week after the appointment of former 3M and GE Aircraft Engines chief executive James McNerney as president and chief executive.
The move came within days of the announcement by Airbus majority shareholder EADS that its shareholders had resolved their long-running wrangle over a new executive management line-up.
Boeing shares jumped 7% to $66 within minutes of the news of the appointment, which came as a surprise after McNerney’s earlier public rejection of the job, which had originally been offered to him less than two months before. “I had a change of heart,” says McNerney. “Lew [Lewis Platt, Boeing lead director] and some of his board members are pretty persuasive.”
Platt says: “Jim has been part of the search since he was on the board, and was one of the first people we talked to.” He adds that after McNerney’s initial rejection of the job offer from the Boeing board, he came back, saying he was “having some trouble living with the decision – he just honestly changed his mind”.
Despite being appointed over competing candidates Alan Mulally and Jim Albaugh, respectively leaders of Boeing’s Commercial Airplanes and Integrated Defense Systems groups, McNerney says: “We will work together, well and productively.”
McNerney replaces interim president and chief executive James Bell, who will remain chief financial officer. Bell assumed the role after the departure in March 2005 of former president Harry Stonecipher, who was forced to resign following revelations of an affair with a Boeing employee.
McNerney says his familiarity with the aerospace business, and Boeing’s commercial and military products through his former role at GE, means the new job “will not be a steep learning curve for me”.
Referring to Boeing’s strategy of targeting the mid-market with its 787 airliner rather than developing a direct competitor to Airbus’s ultra-large A380, he says: “I’m a believer that the strategy that Alan Mulally and his team are pursuing is a winner. I feel good about pursuing that strategy.”
GUY NORRIS/LOS ANGELES