WASHINGTON Nov 17 (Reuters) – Boeing Co (BA.N) said on Thursday that it will consolidate its struggling defense unit by cutting in half the number of divisions and the planemaker made a series of executive leadership changes.
The plan to consolidate is aimed at making its defense business more manageable as Boeing attempts to improve its relationship with the Pentagon, a person briefed on the move said.
The company is slashing its defense unit from eight to four divisions, which include Vertical Lift, Mobility, Surveillance & Bombers, Air Dominance and Space, Intelligence & Weapon Systems, the company said.
Additionally, Boeing Global Services (BGS) will integrate all government services – domestic and international – into one organization.
Last month, Boeing’s defense business recorded a $2.8 billion charge for a number of programs, including Air Force One. Reuters first reported in October that Boeing appointed a senior troubleshooter to help turn around loss-making programs at its Defense, Space & Security (BDS) division.
Boeing also said Thursday that Tim Peters, currently vice president and general manager of Mobility and Surveillance, and Cindy Gruensfelder, currently vice president and general manager of Missile and Weapon Systems, will be retiring after helping with the the transitions.
Shares of Boeing fell less than 1% to $171.94 in afternoon trading.
Reporting by Mike Stone and David Shepardson in Washington and Aishwarya Nair in Bengaluru; Editing by Shailesh Kuber and Anna Driver
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