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International Airlines Group (IAG), the parent company of British Airways, has announced that Alex Cruz is stepping down as CEO of the UK’s flag carrier and, following a transition period, will be relinquishing his role as chairman too. All of this comes towards the end of a year which has seen the airline industry brought to its knees by Covid-19 and thousands of employees losing their jobs at British Airways.
The IAG Shake-Up
Base on the statement IAG has released to investors, it would appear as if Alex Cruz is stepping down as CEO with immediate effect and will be replaced by Sean Doyle, the current chairman and CEO of Aer Lingus. Cruz will stay on in the role of non-executive chairman of British Airways for an interim/transition period after which time Sean Doyle will take on the mantle of British Airways Chairman as well.
Donal Moriarty, the Aer Lingus chief corporate affairs officer will become the airline’s CEO for an interim period while the board of IAG decides upon a permanent appointment.
IAG chief executive, Luis Gallego:
IAG has proved itself to be one of the world’s leading airline groups with a portfolio of successful companies. We’re navigating the worst crisis faced in our industry and I’m confident these internal promotions will ensure IAG is well placed to emerge in a strong position.
I want to thank Alex for all that he has done at British Airways. He worked tirelessly to modernise the airline in the years leading up to the celebration of its 100th anniversary. Since then, he has led the airline through a particularly demanding period and has secured restructuring agreements with the vast majority of employees.
Sean Doyle has extensive experience at British Airways having worked there for 20 years before moving to head Aer Lingus nearly two years ago where he has done an excellent job. I am confident that will continue at British Airways.
It has been a little over a month since Wille Walsh stepped down from his role as head of IAG and the new CEO seems to have wasted little time in making his first big change. To be fair to Alex Cruz, there’s a very good chance that this announcement has as much to do with his likely disillusionment at not being promoted to CEO of IAG following Willie Walsh’s departure and his loss of appetite for his current job following that disappointment, as it has to do with Gallego’s wish to make his first serious mark on IAG as CEO.
Rightly or wrongly, Alex Cruz will always be seen by many as the man who brought cuts and a feel of a low-cost airline to British Airways as he introduced hand baggage only fares, removed complimentary inflight catering for economy passengers on short-haul flights, and cut numerous aspects of service on long-haul flights (some of which he was later forced to reverse).
I’ve never been a big fan of Mr. Cruz (although I have never met him so that may be a bit unfair), but I have to admit that his tenure hasn’t been bad news for everybody. British Airways performed very well as a company for most of his tenure (the airline is still one of the most profitable airlines in the world) and not even his most hardened critics can blame him for Coid-19 (although a lot of people almost certainly blame him for how the airline has been handling the current crisis).
As flyers, we’ve seen Cruz’s British Airways make numerous cuts to the services the airline offers, but the cuts that have been made have mainly been to the services in Economy Class – the premium cabins haven’t taken too many hits. British Airways refreshed its Premium Economy seating for the better a couple of years ago, the new Club World Suite is a huge improvement on the antiquated Business Class seat British Airways has been offering for over two decades, and the First Wing at Heathrow has been a big winner with premium cabin travelers.
It will be interesting to see where British Airways goes from here. Following the full-out wars that management has been having with various employee groups throughout most of 2020, I think it’s safe to say that what bridges were standing between employees and management at the beginning of this year (and there weren’t many) are now long gone, and the relationship between Cruz and his frontline employees has almost certainly been way past repair for some time…but will things change under the new boss?
Sean Doyle seems to have done a very good job over at Aer Lingus but with all due respect to the Irish flag carrier, British Airways is a completely different beast. A big positive for Mr. Doyle is that he doesn’t come with any baggage from a previous stint at British Airways so if anyone has a chance of starting off with a clean slate it’s him. The big negative for Mr. Doyle is that he joins British Airways at a time when the whole travel industry is on its knees, at a time where employee morale is at rock bottom, and at a time where the gulf between employees and management has never been wider.
Sean Doyle had better be up for a challenge because he’s certainly got one on his hands right now.
Alex Crux is stepping down as CEO of British Airways and is being replaced by Sean Doyle, the current CEO of Aer Lingus. At best, the Cruz legacy is a mixed one but, sadly for him, I suspect his time at BA will not be remembered with great fondness by most.