Dennis Muilenburg exits Boeing with $62m, but no severance pay
New York — Boeing’s ousted CEO Dennis Muilenburg is leaving the company with $62m in compensation and pension benefits but will receive no severance pay in the wake of the 737 Max crisis.
Muilenburg was fired from the job in December as Boeing failed to contain the fallout from two fatal crashes that halted output of the company’s best-selling 737 Max jetliner and tarnished its reputation with airlines and regulators.
The compensation figures were disclosed in a regulatory filing late on Friday during a difficult week for Boeing when it also released hundreds of internal messages — two major issues hanging over the company before new CEO David Calhoun starts on Monday.
The messages contained harshly critical comments about the development of the 737 Max, including one that read the aircraft was “designed by clowns who in turn are supervised by monkeys”.
The 737 Max has been grounded since March after the second of two crashes that together killed 346 people within five months.
“It is incredibly heart wrenching to see the man at the heart of our loss walk away with a reward,” said Zipporah Kuria, whose 55-year-old father from Kenya died in the second crash.
Legislators also criticised Boeing. US Senator Elizabeth Warren said on Twitter: “346 people died. And yet, Dennis Muilenburg pressured regulators and put profits ahead of the safety of passengers, pilots, and flight attendants. He’ll walk away with an additional $62.2m. This is corruption, plain and simple.”
US Representative Peter DeFazio, who chairs the House transportation committee, said minutes of a June 2013 meeting showed that Boeing sought to avoid expensive training and simulator requirements by misleading regulators for an antistall system called MCAS that was later tied to the two crashes that killed 346 people.
Speculation that Muilenburg would be fired had been circulating in the industry for months, intensifying in October when the board stripped him of his chair title, though he had also twice won expressions of confidence from Calhoun, Boeing’s board chair.
A turnaround veteran and former General Electric executive who has led several companies in crisis, Calhoun will receive a base salary at an annual rate of $1.4m and is eligible for $26.5m in long-term incentive compensation, Boeing said in a filing.
Boeing said in November Muilenburg had volunteered to give up his 2019 bonus and stock awards. For 2018, his bonus and equity awards amounted to about $20m, according to filings.
In addition to the $62m in compensation and pension benefits, Muilenburg holds stock options that vested in 2013, Boeing said. They would be worth $18.5m at the closing price on Friday.
“Upon his departure, Dennis received the benefits to which he was contractually entitled and he did not receive any severance pay or a 2019 annual bonus,” Boeing said.