Aerospace giant Boeing is shaking up the leadership of its defense business one week after the government refused to overturn an $80-billion Air Force deal awarding rival company Northrop Grumman a coveted contract to build new stealth bombers.
The Chicago-based company’s board elected Leanne Caret, a 28-year company veteran, president and CEO of Boeing Defense, Space & Security and announced that Chris Chadwick, the current head of the business, would retire on March 1 after two years in the job. Caret will formally become CEO that same day.
“Leanne has a track record of delivering results, an intense customer focus, and the global acumen necessary to build on the existing strengths of our defense, space and security business and grow it for the future,” Dennis Muilenburg, Boeing chairman, president and CEO, said in a statement.
Muilenburg ran Boeing’s defense business before Chadwick took over in 2013. Boeing’s board elected Muilenburg chairman just two days ago. He became CEO in July after two years as president and chief operating officer.
Boeing, best known as maker of the iconic commercial jetliners that revolutionized global air travel, lost the lucrative stealth bomber contest in the fall. They contested the Air Force’s selection of Northrop to the Government Accountability Office. After an audit, the GAO upheld the deal last week.
The company’s defense earnings were slightly down in Chadwick’s two years in charge, with the company bringing in $30.4 billion in 2015 and $30.9 billion in 2014. In 2013, Boeing’s defense business made $33.2 billion. Boeing’s commercial airplane business made $66 billion in 2015, up $6 billion from the previous year.
The company’s defense business also had to eat $1.3 billion over the past two years stemming from embarrassing problems that have popped up when building a new aerial refueling tanker for the Air Force that is based on its commercial 767 jetliner.
Boeing, which had partnered with Lockheed Martin in the bomber contest, had been hoping the project would inject new life into its combat aircraft manufacturing business, as two of its fighter jet programs could end of production at the end of the decade. The U.S. Navy and Australia’s military are still buying F/A-18 Super Hornets and Boeing has been actively pitching the warplane on the international market. Boeing also builds new F-15 Eagles for Saudi Arabia.
Still the company has seen stability for other military projects, including the P-8 submarine-hunting plane for the Navy and Army Chinook and Apache helicopter projects. Boeing is among the companies eyeing a $10 billion project to built jet training planes for the AIr Force.
Caret, who most recently led Boeing Defense’s Global Services & Support division, previously ran the company’s helicopter business.