Aerospace & Defense

Boeing CEO had to be fired in order for the 737 Max to get FAA certified, Jim Cramer says

Key Points
  • Former Boeing CEO Dennis Muilenburg had to be fired in order for the 737 Max jet to receive regulatory approval, CNBC's Jim Cramer says.
  • "It was impossible to get clearance with all these different entities," the "Mad Money" host argues.
  • Cramer says he had been wondering when accountability over the two fatal crashes would reach the top of the company.
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Cramer: Boeing had to get Muilenburg out to get the process going

Former Boeing CEO Dennis Muilenburg had to be fired in order for the 737 Max jet to receive regulatory approval, CNBC's Jim Cramer said Monday.

"It was impossible to get clearance with all these different entities as long as he was there, because he presided over what happened," Cramer said on "Squawk on the Street."

Boeing announced Muilenburg's firing Monday morning as the Chicago-based aviation giant struggled to regain the trust of regulators who need to certify the 737 Max.

Chairman David Calhoun will become the manufacturer's new CEO on Jan. 13. The transition period will allow him to exit his non-Boeing commitments. CFO Greg Smith will serve as interim chief executive.

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Boeing CEO Dennis Muilenburg is stepping down—Here's what four experts say it means for the company and stock

The 737 Max has been grounded worldwide since March after two of them crashed — one in October 2018 and the other in March — killing 346 people in total. The Max's malfunctioning flight-control system has been implicated in the disasters.

Boeing has for months been eyeing certification by the end of 2019 and in late November it still believed the plane could return to commercial service by the end of January.

But the Federal Aviation Administration has repeatedly said it will take all the time it needs to deem the 737 Max safe.

And over the weekend, The New York Times reported on a recent tense, face-to-face meeting in which the head of the FAA, Stephen Dickson, criticized Muilenburg for putting public pressure on the agency to certify the jet.

Muilenburg also faced intense scrutiny earlier this fall during congressional testimony that Cramer called a "disaster."

"You simply had to get Muilenburg out to get this process going," Cramer said. "I don't think anybody wanted to deal with him."

The "Mad Money" host said he had been wondering when accountability at Boeing over the fatal crashes would reach the top echelon of the company.

"Someone had to pay the price, and it has to be him," Cramer said, adding he thinks Calhoun, a former General Electric executive, is a strong replacement for Muilenburg.

Under Calhoun's leadership, Cramer said, the process to regain regulatory approval will be accelerated.

"This plane is going to be in the air someday. But I just don't think Dennis was going to get it to the promised land," Cramer said.

Shares of Boeing were up more than 2% on the news, trading around $336.

— CNBC's Leslie Josephs and Amelia Lucas contributed to this report.

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Dennis Muilenburg steps down as Boeing CEO