Boeing Co. tapped 3M Co. chairman and chief executive W. James McNerney Jr. as its new chief executive yesterday, choosing an industry veteran to lead the company through an intense battle for dominance in the commercial aircraft market and repair its image with the military after a series of ethical lapses.
After the company's four-month search, McNerney, who is already on Boeing's board, became the aerospace giant's third chief executive in the past 21/2 years. McNerney said he initially rebuffed Boeing's overtures out of loyalty to 3M but had a "late change of heart."
While McNerney, 55, said he plans no strategic changes, he will face several challenges, including operating in the face of proposed cuts in defense spending and launching Boeing's first new aircraft in nearly 10 years, the 787 Dreamliner. Also, Boeing and its European rival Airbus SAS are embroiled in a transatlantic trade battle over subsidies.
Chicago-based Boeing's top post has been in flux since Philip M. Condit resigned in December 2003 during a scandal in its defense business. The company also fired its chief financial officer for ethical lapses.
Harry C. Stonecipher, a former Boeing senior executive, took over from Condit, promising to restore the company's reputation, but was forced to resign after revelations of an affair with an employee. The interim chief executive post then fell to finance chief James A. Bell, who will return to his previous position.
"You have to earn your reputation every day," McNerney said in an interview. "I don't think we have earned trust everywhere in Washington yet."
McNerney was considered the most likely choice because he has served on Boeing's board since 2001 and had experience in the commercial and defense fields while an executive at General Electric Co. In appointing McNerney, Boeing's board bypassed Alan R. Mulally, the head of the commercial business, and James F. Albaugh, chief of Boeing's military unit, and avoided the appearance that either unit would be favored.
McNerney will also take the titles of president and chairman of the board. The current chairman, Lewis E. Platt, will become lead director.
Boeing's shares rallied on the announcement yesterday, climbing $4.33 a share, or 7 percent, to close at $66. 3M lost $3.74, or 4.9 percent, closing at $72.30.