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Automatic TRANSCRIPT

On Swap pod Boeing owing speaks out hiding. It was a set of engineering decisions. That ended up being wrong. Boeing Chairman David Calhoun in an exclusive interview amid mounting pressure. The aftermath of two seven three seven Max crashes has put on the company this airplane will will fly it will be safe as well as the CEO. He is going to experience experience in his first period. One of the most difficult situations any CEO. That I've ever known has lived through and exclusive to this podcast. CNBC'S CNBC's auto and aviation reporter Phil above the narrative completely got away from them anchors on today's squawk box are Joe Kernan becky quick and CNBC contributor Surat Sethi joins as has guest host your host on this podcast that's me CNBC producer. Katie Kramer it's Tuesday November fifth. Two Thousand Nineteen Squad begins right now. So what's your process to hold people accountable to make sure this doesn't can happen again. Senator First of all my company and I are are accountable. I believe that accountability starts with with me My board took some recent actions regarding my position which I fully support and will allow me to focus even more on on safety so every action takes tried to focus on safety that was bowing CEO. Dennis Muilenburg and Florida Senator Rick. Scott during last week's blistering questioning joining of the airplane manufacturers leader on Capitol Hill one month ago Boeing's board stripped Lindbergh at his chairman title in the wake of months of criticism. Boeing grounded the entire fleet of jets. Let's call seven three seven Max. Following two deadly crashes one late last year and one in March of Twenty nineteen today for the first time we hear. From the new chairman of Boeing Blackstone. Executive Dave Calhoun. I caught up with my colleague film about Polo. Thank you Why don't you introduce yourself? I am Filipo. I cover aviation listen and the airlines for CNBC. And I've been doing it for twenty years. How long have you been covering the Boeing Company? Twenty Years Twenty years of watching this company company grow Go through some challenging times and this is clearly the most challenging time. They've gone through so. Tell me about that. The last eight months the headlines for Boeing have been really grim. Well anytime you have a plane crash. It's bad news and I know that's maybe we'll be listening to the same well Duh. Of course it's bad news but it's not just that there was a plane crash It was two of them very short period of time between them that led to the grounding of the seven thirty seven Max and had to put this into some perspective for people the seven thirty seven is the bread and butter for this company It is the cash flow generator. And so when you are effectively effectively saying we're not delivering any of these. You're cutting off. The cash pipeline for Boeing Commercial Airplanes It is a massively important story. Sorry one that everybody has a feeling about it. emotionally Whether they're in the industry or if it's somebody who who flies only occasionally people have A real concern about whether or not these planes which are so popular Are they safe. Will they be safe in the future so today on the show we had David Calhoun. Who is the new non-executive Chairman of Boeing directors? But I but very active. It's pretty clear from his interviewees active. Tell me about the scope of Calhoun job now. And what makes him qualified to lead Boeing during chapter. He's been on the board since two thousand nine and he also has a history going back to his time with GE when he was CEO of Ge Infrastructure Working Ge jet engines He's familiar with the aviation the airline business and he's also familiar with the challenges that go along with running a a large industrial. Austria company like Boeing and essentially. Now that he is non executive chairman that title used to belong to Dennis Muilenburg. And the Board has said. We're going to split your titled. Dennis is going to be. CEO Run day to day activities. The broader questions for the company vision where they're going so forth. That will go to Dave Calhoun L.. Who and when we talked to Dave Calhoun he made it very clear? We want Dennis Muilenburg to focus on getting the Max back in service that is that is the main job really the only job that matters right now for him. I'm sure he's doing some other things as well. I mean it's not like he's in a vacuum But the Max is all encompassing right now. Why why is he speaking out now a month? After kind of taking the reins of Boeing. Will I think the narrative got away from them last week. When Dennis Momberg was on Capitol Hill It was a brutal brutal couple of days. I mean you had senators and representatives outright saying you have no business being CEO. You have no business getting the compensation in that you get. If you had any decency you would step down. You would do more than simply say we're working on this. Is Anybody at Boeing taking a cut or working for free to try to rectify this problem. Like the Japanese do congressman. My board conduct a comprehensive review. That so you're saying you're not giving giving up any compensation at all your continue to work and make thirty million dollars a year after this horrific two accidents that caused all these people's relatives took go to disappear to die. You're not taking a cut in pay. It all began. Our board will make those terminate. You're not accountable. Then you're saying the boards accountable. I went in Quebec. And kind of underlying Steve Cohen of Tennessee. In the second day of my Lindbergh's yeah in front of the House. We talked with them afterwards in the hallway. I mean he's disgusted rested instead. I'm disgusted at at this entire situation here and that he is getting paid what he's getting paid. Which is roughly twenty three million dollars last year so it was wild because Representative Cohen was asking question? Are you taking a pay cut. Is Somebody going to take some financial responsibility for this and mullet Bergara sort of during the headlights. Absolutely and You could fault Boeing for not being better prepared for that question. Look I've covered enough of these over the years on Capitol Hill when a CEO goes in front of a committee especially Leanna safety related matter. I mean that is almost a guaranteed question. Look if you would fault Boeing for anything last week. It's the fact that they didn't anticipate that. This question streams coming because they could've nipped in the bud much quicker by having Dennis Muilenburg even in his opening remarks say I understand what's going on. I understand that I shouldn't be getting the compensation or at least all of the compensation That I received last year That would've short-circuited a lot of this discussion. Instead he said Ed That's not for me. That's for the board decide really came off looking very poor for the company and for him to stand by Joe Three to one his mic. It's it's time for our newsmaker. The morning Boeing Chairman Dave Calhoun the Dow component is you know separated at CEO and chairman roles amid the seven thirty seven Max crisis naming. Calhoun Muniz chairman on October eleventh. Relatively quiet since then in terms of on camera interviews this morning. He's speaking out in a squawk box exclusive. Dave joins us now with their own Philibeaux. Oh global headquarters Phil Good Morning. Good Morning Mr Galvin. Who Good Morning Joe? Joe And I know you guys have a number of questions for Dave and Dave. Let's let's begin first off if you and I were talking before you came out here. Big Question right off. The Bat is about the compensation for Dennis Muilenburg. This came up on Capitol Hill. You have some news regarding and how that's going to be changing correct. Yeah I do of course it was sort of obvious to everyone that was uncomfortable question for Dennis. Dennis doesn't like to speak in behalf behalf of board activities anyway. Dennis called me Saturday morning at ten o'clock with the purpose of suggesting that he Not Take any compensation for two thousand nineteen as in the form of bonuses which is of course most of your compensation it