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Saturday, December 4, 2004 - Page updated at 12:00 AM

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Boeing sales to get new leadership

Seattle Times business reporter

Boeing announced a shake-up in its executive ranks yesterday, ousting its chief airplane salesman at a time when rival Airbus is beating it in airplane orders for the fourth consecutive year.

The company said it has replaced its head of airplane sales, Toby Bright, with Scott Carson, the former leader of Boeing's Connexion unit. That move led to a flurry of four other internal executive switches.

The company said Bright will stay with the company, with unidentified "new responsibilities" within Boeing Commercial Airplanes.

Analysts questioned whether the changes will affect the underlying challenge for Boeing, which is that Airbus is selling its competing planes at substantially lower prices. That dilemma was underscored this summer by Dan Becker, the person in charge of all airplane programs at Everett, who, according to internal documents, told employees that the 777 is "the premier twin-aisle airplane in the world" but "it has only one problem. It costs too much."

Boeing did not make executives available for interviews. In a statement, chief executive Harry Stonecipher said, "Scott's appointment will strengthen and improve our global sales effectiveness — and that's one of our highest priorities."

Bright, 51, has been Boeing's chief airplane salesman since January 2002. Under his watch, Boeing has been challenged by two powerful forces — price undercutting by rival Airbus, and financial ruin among Boeing's core customers in the U.S. airline industry. In the last year, Stonecipher has also placed an emphasis on selling planes at a profit, not on selling planes at a loss to gain market share.

During Bright's tenure to date, Airbus has outsold Boeing in net airplane orders 715 to 601, according to market analyst Back Aviation Solutions. Boeing also appears likely to fall short of earlier projections that it would win 200 orders this year for its next-generation 7E7 jet. Heading into the final month of this year, Boeing has announced 52 orders.

Adam Pilarski, an aviation analyst with Avitas, said someone had to end up taking responsibility for the performance, regardless of how difficult the circumstances. Pilarski called Bright "a super nice guy," polite, low-key and straightforward. Bright "was dealt a bad hand," but a change needed to be made, Pilarski said.

"If you are a coach of a football team and your star quarterback gets injured, and you have a losing season, you're still out of there," he said.

But Richard Aboulafia, an analyst with the Teal Group, criticized Boeing's move. He said Bright couldn't possibly compete with the price-undercutting of Airbus, when Boeing's top management insists it can't do what he called "dumb deals."

"It's unlikely that history will judge Toby Bright harshly," Aboulafia said.

Analysts described Carson, 58, the man replacing Bright in charge of sales, as a well-regarded Boeing veteran, with an affable personality. He was appointed to run Connexion, Boeing's in-plane Internet technology venture, when it started in 2000. In his four years there, it reached the market in Europe and Asia. Carson was chief financial officer of Boeing Commercial Airplanes before joining Connexion.

Bob Toomey, an analyst with RBC Capital Markets who owns Boeing stock, said Carson will walk into a difficult situation, competing against a company "that doesn't care about profit." To compete, he said Carson and the Boeing sales force will have to offer better products at a competitive price, make them more efficient to operate, and offer better customer service.

Carson, like Bright, will offer a contrast with John Leahy, Airbus' chief salesman. Leahy is well-known for his brash style; in an interview with The Seattle Times at the Farnborough Air Show in July, he dismissed some of Boeing's cool 7E7 styling, saying that what matters is floor space, cargo room and operating costs. "We're not selling sports cars to middle-aged men in midlife crisis," Leahy said at the time.

Toomey said Carson's financial background could also be an asset in sales.

He said Boeing has appeared to be getting close to signing more orders for the 7E7, but hasn't been able to close the deal. The recent loss to Airbus of an order from Air Berlin, a traditional Boeing customer, may have been the last straw for Bright, he said.

"Maybe they feel they need someone who's a stronger closer," Toomey said.

The other key Boeing managers who got new assignments in yesterday's re-shuffling are:

• Laurette Koellner, 50, who will become the new president of Connexion by Boeing.

• Rick Stephens, 52, will replace Koellner at the helm of Internal Services, which includes human resources, corporate administration, and Boeing Shared Services Group.

• Mary Armstrong, 48, will replace Stephens in charge of Shared Services, which handles companywide functions like purchasing, real estate and security.

• Ross Bogue will replace Armstrong as the head of the Fabrication Division, which makes composite materials in Auburn and Frederickson.

Luke Timmerman: 206-515-5644 or ltimmerman@seattletimes.com.

Seattle Times business reporters Melissa Allison and Dominic Gates contributed to this report.

Copyright © 2004 The Seattle Times Company

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