Qualcomm, United Technologies Executives Join Boeing Board Of Directors

The Boeing Company BA on Monday said it had nominated two new directors to its board.

What Happened

QUALCOMM Inc. QCOM chief executive officer Steve Mollenkopf and United Technologies Corporation UTX former chief financial officer Akhil Johri will be elected directors at the aircraft maker's annual meeting of shareholders in April.

Longtime directors Edward Liddy and Mike Zafirovski will retire from their posts at the same meeting, Boeing announced.

"Our announcement today reflects our rigorous succession planning, which ensures we maintain the right balance of skills and experience to effectively govern the company," Boeing Chairman Larry Kellner said in a statement.

"[Mollenkopf and Johri] are proven leaders at complex, global enterprises and together will bring significant additional safety, engineering, software, and financial experience to our board."

Why It Matters

The Boeing board of directors has faced increased scrutiny from both the regulators and shareholders as the company went deeper into the 737 Max crisis.

The 737 Max aircraft line was grounded in March last year as two fatal crashes involving the aircraft killed at least 376 people.

In addition to the initial technical faults, internal audits revealed further problems in the engine panel and wiring of the aircraft. Recently Boeing reported debris in the fuel tanks in as many as 70% of all vehicles.

The problem for the board intensified when the Federal Aviation Administration revealed documents of internal communication of the Boeing team working on the aircraft, which showed that the employees deliberately ignored safety risks.

The 737 Max isn't expected to be ungrounded at least until the later half of this year.

Price Action

Boeing's shares closed 3.78% lower at $317.9 on Monday and were mostly unchanged in the after-hours session.

United Technologies closed 3.26% lower at 146.58 but jumped 2.33% in the after-hours session at $150.

Qualcomm stock closed 4.26% lower at $83.32 per share and jumped 0.82% at $84 in the after-hours session.