Fired Boeing CEO Dennis Muilenburg could get $52M as families of crash victims may receive $144K

Fired Boeing CEO Dennis Muilenburg may walk away from the company with a $52million severance package while the families of crash victims could receive just $144,500.

To break that number down even more, that means Muilenburg could get 360 times what Boeing will be paying to families like Paul Njoroge, who lost his wife and three young children in the March 10 Ethiopian Airlines crash that killed 157.

Others who lost family members in the Ethiopian and Lion Air 737 Max crashes will also be receiving $144,500 from a $50million financial assistance fund.

Boeing also announced in July it planned to spend an additional $50million to support education and economic empowerment in impacted communities. 

The 737 Max has been grounded since March after fatal crashes in Ethiopia and Indonesia.

 

Fired Boeing CEO Dennis Muilenburg (pictured in October) may walk away from the company with a $52million severance package while the families of crash victims could receive just $144,500

To break that number down even more, that means that Muilenburg will be getting 360 times what Boeing will be paying to families like Paul Njoroge (pictured at hearing in October), who lost his wife and three young children in the March 10 Ethiopian Airlines crash that killed 157

Others who lost family members in the Ethiopian and Lion Air 737 Max crashes will also be receiving $144,500 from a $50million financial assistance fund. Relatives of passengers of the Lion Air jet crash are seen looking for their loved ones’ belongings in October 2018  

The 737 Max (file image) has been grounded since March after fatal crashes in Ethiopia and Indonesia 

Robert Clifford of Clifford Law Offices, which represents families of the Ethiopian crash victims, said 103 lawsuits have been filed against Boeing so far over the second crash, with 30 more cases expected to be filed soon. 

Muilenburg publicly announced his resignation on Monday just one day after the return of the Starliner flight that threatened to derail Boeing’s attempts to launch astronauts for NASA in 2020.

Minutes after the Starliner took off from Cape Canaveral, Florida, on Friday, a software glitch caused the spacecraft to launch into the wrong orbit, prompting officials to route it back to Earth instead of continuing on to the International Space Station.

The capsule did successfully land on the Army’s White Sands Missile Range in the predawn darkness on Sunday, ending a two-day demo that should have lasted more than a week.

Muilenburg has compensation benefits that range between $30million and $39million, according to company filings accessed by The Telegraph.  

He also has an executive pension pot worth an additional $13million that will accompany him as he leaves his position. 

Ethiopian Airlines Flight 302 crashed on March 10, 2019. After the plane crash in Ethiopia, investigators and officials recovered objects from the crash site

Lion Air Flight 610 (wreckage pictured) plunged into the sea off the coast of Indonesia on October 29, 2018

That comes atop an approximate $70million that Muilenburg earned during his four-and-a-half years as Boeing’s top executive. 

Previously, Muilenburg announced that he would give up around $20million in bonuses and stock grants following the two crashes. 

Chairman David Calhoun publicly backed Muilenburg and insisted on the company’s faith in his ability in an interview with CNBC. 

The board’s current chairman David Calhoun will officially take over as CEO on January 13

‘From the vantage point of our board, Dennis has done everything right. It was a set of engineering decisions that ended up being wrong,’ he said.

‘Dennis didn’t create this problem, but from the beginning he knew that MCAS should and could be done better, and he has led a program to rewrite MCAS to alleviate all of those conditions that ultimately beset two unfortunate crews and the families and victims.’ 

Muilenburg is currently under investigation by the Justice Department and Congress. 

In Congress, members questioned Muilenburg’s compensation while challenging him to resign or at least give up pay.

Last year, Muilenburg was paid $23.4million, including a $13.1million bonus and $7.3million in stock awards.

Stock awards from previous years reportedly pushed Muilenburg’s total to more than $30million.

‘Mr. Muilenburg’s answers to our questions were consistent with a culture of concealment and opaqueness and reflected the immense pressure exerted on Boeing employees during the development and production of the 737 Max,’ said Peter DeFazio, chairman of the House Transportation Committee and Rick Larsen, chairman of the aviation subcommittee.   

Muilenburg publicly announced his resignation on Monday just a day after the return of the Starliner flight that threatened to derail Boeing’s attempts to launch astronauts for NASA in 2020. All three main parachutes opened and airbags inflated around the spacecraft 

Boeing landed its crew capsule in the New Mexico desert Sunday after an aborted flight to the International Space Station

Crews are seen tending to the Starliner after its successful landing on Sunday morning 

Calhoun will serve as CEO and president, effective January 13, the company said Monday. 

‘The Board of Directors decided that a change in leadership was necessary to restore confidence in the Company moving forward as it works to repair relationships with regulators, customers, and all other stakeholders,’ the company said in a statement.  

The company’s shares, which have fallen more than 20 per cent since March, rose more than 2 per cent to $335.24 in early trading. 

Overall, the Dow was up on Monday on the back of news that China will cut import tariffs from January 1, but watchers also said Boeing’s share price was boosting the market 

The decision to fire Muilenburg followed a recent announcement that Boeing would suspend production of its best-selling 737 Max model from January. 

It is the plane maker’s biggest assembly-line halt in more than 20 years.

The departure comes as the world’s largest planemaker struggles to win regulatory approvals for its grounded best-selling jetliner while trying to repair trust with passengers and airline customers. 

The 737 Max was banned from flying in March 2019 following two devastating overseas crashes that left 346 dead.

The decision to suspend production was made by Boeing’s board after a two-day meeting in Chicago, just one week after the Federal Aviation Administration (FAA) said it would not approve the plane’s return to service before 2020. 

Boeing CEO admits key mistakes in development of 737 Max

In October then Boeing CEO Dennis Muilenburg, who was fired Monday, admitted key mistakes in the development of the 737 Max.

He was repeatedly hammered by U.S. lawmakers at a hearing over flaws with the 737 Max, which has been grounded in the wake of two deadly crashes.

Boeing’s development of a key flight control system, known as MCAS, took front and center at the hearing as Muilenburg acknowledged ‘we made some mistakes’ in its design.

The anti-stall system, which was at the center of twin crashes in Ethiopia and Indonesia that killed 346 people, automatically pushed the plane’s nose down in both crashes and left pilots fighting for control. 

Family members hold photos of the victims of Boeing 737 Max crashes as Boeing Chief Executive Dennis Muilenburg testifies before the House Transportation and Infrastructure Committee on Wednesday

Lawmakers released Boeing documents that showed the company had considered adding an MCAS failure alert on the flight control panel to the 737 Max.

Another Boeing document warned that if a pilot failed to respond in more than 10 seconds to the software, activation could lead to a ‘catastrophic’ failure.

A newly released internal email from 2015 was also released in which a Boeing engineer had voiced concerns about whether the flight control system they were developing was unsafe because it relied on a single sensor.

‘Are we vulnerable to single AOA sensor failures with the MCAS implementation,’ the employee wrote.

The email, which was sent more than a year before the plane received final approval to fly, raised concerns about an issue that would go on to be the cause of the two fatal crashes. 

Boeing’s shares have fallen more than 20% since March but rose more than 3% in early trading 

Boeing’s shares have fallen more than 20% since March but rose more than 3% in early trading

Calhoun says he strongly believes in the future of Boeing and the 737 Max. 

The 737 Max grounding was the biggest crisis of Muilenburg’s 34-year tenure at Boeing, where he started as an intern in 1985, rising through the company’s defense and services ranks to the top job in 2015.  

Speculation that Muilenburg would be fired had been circulating in the industry for months, intensifying in October when the board stripped him of his chairman title.

Board member Lawrence Kellner will become non-executive chairman of the board effective immediately, the company said. 

Chief Financial Officer Greg Smith will serve as interim CEO during the brief transition period.

United Airlines has previously said it would pull the Boeing 737 Max from its flight schedule until June. 

Spirit AeroSystems, which makes fuselages, said it would end deliveries intended for the Max in January.

Kellner, the new non-executive chairman of the board, said in a statement: ‘On behalf of the entire board of directors, I am pleased that Dave has agreed to lead Boeing at this critical juncture.

‘Dave has deep industry experience and a proven track record of strong leadership, and he recognizes the challenges we must confront. 

‘The board and I look forward to working with him and the rest of the Boeing team to ensure that today marks a new way forward for our company.’

Key events leading up to the firing of Boeing’s CEO over the 737 Max

OCT. 29, 2018 – A Lion Air 737 Max plane crashes in Indonesia, killing all 189 people on board

NOV. 13, 2018 – FAA, Boeing say they are evaluating the need for software or design changes to 737 Max jets following the Lion Air crash

NOV. 30, 2018 – Boeing is weighing plans to launch a software upgrade for its 737 Max in six to eight weeks that would help address a scenario faced by crew of Indonesia’s Lion Air, sources told Reuters

MARCH 10, 2019 – An Ethiopian Airlines 737 Max crashes, killing all 157 people on board

MARCH 12, 2019 – FAA says will mandate that Boeing implement design changes on the 737 Max by April that have been in the works for months

MARCH 13, 2019 – FAA joins other major global regulators in grounding the 737 Max, citing evidence of similarities between the two fatal crashes

APRIL 6, 2019 – Boeing says it will cut monthly 737 Max production by nearly 20%; U.S. and airline officials say they believe the plane could be grounded for at least two months

MAY 16, 2019 – Boeing says it has completed a software update for its 737 Max jets and is in the process of submitting a pilot training plan to the FAA

JUNE 27, 2019 – Boeing says it will take until at least September to fix a newly identified problem with software that emerged when FAA test pilots were reviewing potential failure scenarios of the flight control computer in a 737 Max simulator

JULY 18, 2019 – Boeing says it has assumed regulatory approval of the 737 Max’s return to service in the United States and other jurisdictions will begin early in the fourth quarter 

OCT. 24, 2019 – Boeing says it still expects FAA approval to fly the 737 Max in the fourth quarter, sending its shares higher despite a slump in quarterly profit. FAA says it will need “several weeks” for review

NOV. 7, 2019 – U.S. and European regulators ask Boeing to revise documentation on its proposed 737 Max software fix

NOV. 11, 2019 – Boeing says it expects the FAA to issue an order approving the plane’s return to flight in December, forecasting commercial flights to resume in January

NOV. 15, 2019 – The head of the FAA tells his team to “take whatever time is needed” in their review of the 737 Max 

DEC. 11, 2019 – FAA chief Steve Dickson says 737 Max will not be cleared to fly before the end of 2019

DEC. 12, 2019 – Boeing abandons its goal of winning regulatory approval for the 737 Max to resume flying in December after the U.S. Federal Aviation Administration (FAA) said the plane would not be cleared to fly before 2020

DEC 23, 2019 –  Boeing fires CEO Dennis Muilenburg

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