Boeing Company (BA.US) CEO's first major move after taking office: "firing" the head of the defense and space department.

Boeing Company (BA.US) announced on Friday that Ted Colbert, the troubled head of the Defense and Space division, will be leaving immediately, marking the first significant personnel change since the appointment of new CEO Kelly Ortberg. Ortberg, who took office in August, stated that Colbert will depart and the division's Chief Operating Officer, Steve Parker, will assume Colbert's responsibilities until a successor is appointed later. Colbert joined Boeing Company in 2009 after working at Citigroup and Ford Motor Company. He took over the Defense and Space division in April 2022 after the previous head was dismissed. In an email to employees, Ortberg wrote, "At this critical moment, our top priority is to restore customer trust and meet their high standards to help them complete critical missions around the world. Through our collective effort, we can and will improve our performance and ensure we deliver on our promises." Boeing Company's space business has suffered major setbacks, especially after NASA recently decided to have Boeing Company's Starliner spacecraft return to Earth uncrewed after years of setbacks. As Colbert departs, Boeing Company is trying to save money, announcing temporary layoffs for thousands of white-collar employees amidst a strike by over 32,000 staff. In January, a 737 MAX 9 aircraft experienced an emergency in the air, adding to Boeing Company's challenges. The Federal Aviation Administration has increased supervision of Boeing Company and prohibited it from increasing MAX aircraft production to over 38 per month until significant improvements are made in quality and safety. Ortberg wrote in another email to employees on Friday, "Historically, Boeing Company has been renowned for its project management capabilities, and we need to ensure this remains a key strength for us in the future." The Defense, Space, and Security division, one of Boeing Company's three main businesses, has incurred billions of dollars in losses in 2023 and 2022, with executives largely attributing this to cost overruns on fixed-price contracts. While such contracts are profitable, defense contractors are vulnerable to inflation pressures. In recent years, inflation pressures have eroded profits for American businesses. Boeing Company's stock fell by around 1% on Friday and has declined by 41% so far this year.