Boeing Sets Buyback; Axes Exec

Boeing jettisoned the president of its commercial airline group, the latest casualty among a management under fire from shareholders because of the company's swooning performance.

Separately, Boeing announced after the market closed Monday that it will buy back up to 15 percent of its 972.7 million outstanding common shares.

That helped lift shares off their 52-week low, as the stock added 1 9/16 to 32 1/2 in Tuesday morning trading.

Ronald B. Woodard, once a rising star at the jetmaker, has been forced out after new cost problems were uncovered at the Wichita-based division that reportedly could run into the hundreds of millions of dollars.

"We have experienced unsatisfactory financial performance with our commercial airplane operations. Our expectations are that commercial airplane operations produce significant, double-digit operating margins," Boeing CEO Phil Condit said. "We concluded there must be significant changes in the composition of the management team at this time."

Woodard will be replaced by Alan Mulally, the 53-year-old chief of Boeing's defense and space group, the company said.
Following the news, PaineWebber raised Boeing to "attractive" from "neutral," while Morgan Stanley reiterated its "strong buy" rating.

Boeing has faced heightened pressure from angry shareholders, as cost overruns and production problems propelled the world's largest maker of airliners to a loss of $178 million in 1997 despite a record boom in orders. The company has also been losing market share to Europe's Airbus consortium.

In the past few days, many big companies have announced stock buybacks, taking advantage of the huge decline in prices amid the broad market sell-off.

Written by Jeffrey Bartash