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Boeing’s defense chief is leaving the company after years of losses from fixed-price contracts and a high-profile disaster involving a spacecraft accident that sent two astronauts into space.
Ted Colbert, who has run Boeing’s defense, space and security business since 2022, will be leaving the company “effective immediately,” CEO Kelly Ortberg said in a memo to employees Friday. A Boeing spokeswoman said Colbert had decided to leave.
Colbert’s departure is the first change in the company’s leadership since Ortberg took over the top job from Dave Calhoun last month. Steve Parker, chief operating officer of the defense business, will lead the company on an interim basis until the company names a permanent successor to Colbert.
Boeing’s defense business reported losses in the second quarters of 2022, 2023 and 2024. The division has struggled with fixed-price contracts for several large programs, which account for just 15% of revenue but have racked up nearly $14 billion in costs over the past decade. Jefferies analyst Sheila Kahyaoglu estimates that fixed-price programs could burn $2.6 billion in cash this year and $1.8 billion in 2025.
The program includes the KC-46 tanker, the T-7A Air Force trainer, the MQ-25 refueling drone, and the CST-100 Starliner spacecraft, which is built to carry the U.S. president’s Air Force One jet and astronauts to the International Space Station.
Boeing was dealt a major blow last month when NASA abandoned plans to return astronauts Sunita Williams and Barry Wilmore to Earth on a Boeing spacecraft. Due to technical issues, the agency now plans to return the pair on a SpaceX spacecraft in February.
The group’s problems aren’t limited to its defense business. Boeing has been bleeding cash this year, a result of slowing commercial aircraft production as it tries to improve manufacturing quality after a series of crises. The company has come under scrutiny since a commercial jet’s door panel blew off in flight in January, and its shares have fallen nearly 40% this year.
The company’s ability to generate cash is tied to supplying planes to airlines, but it was questioned again last week after 33,000 unionized workers walked out demanding better pay and retirement benefits. Boeing is implementing furloughs and a hiring freeze to conserve cash.
Credit rating agencies have said Boeing’s cash flow is a key factor in whether to keep the company at investment grade or downgrade it to junk status. The company is under pressure to raise more cash by selling stock, which could value it at $10 billion.
