Alex Cruz, the man who has captained British Airways through possibly the worst period in the company’s history, announced this week that he would be stepping down from his role as CEO. The news comes after a string of misfortunes on Cruz’s watch, none of which has been helped by the coronavirus pandemic.
Despite Cruz taking a one third pay-cut during the coronavirus pandemic, he told MPs earlier this month that the airline’s outgoings are still around £20 million per day. Cruz also criticised the government’s short-sighted refusal to allow coronavirus testing at airports, as well as its policy of releasing new travel restrictions each Thursday. “The weekly [quarantine] announcement is incredibly disruptive – primarily for our passengers,” he said. “If we could start [testing] tomorrow, it would help the British economy.”
Cruz had held the CEO title since 2016, having left a similar role at Spain’s second largest airline, Vueling, in 2015. Replacing him is Sean Doyle, former CEO of Aer Lingus. Now 49, Doyle has history with BA, having joined the company at 27 in various roles before being promoted to director of network, fleet and alliances. He moved into his role as chief executive of Aer Lingus as recently as January last year.
With his history at BA – not to mention the fact that both airlines are owned by the International Airlines Group (IAG) – Doyle will be hard pressed to fare worse than his predecessor. Luis Gallego, CEO of IAG explains, “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.”
Upon announcing the news of Cruz’s replacement, shares in IAG temporarily dropped 0.7% to 102.9 pence. With coronavirus taking an unavoidable toll on the airline industry, the stock has lost 75% of its value this year. It’s vital, then, that its subsidiaries – including BA – begin to turn a profit again.
In its attempt to do so, BA has drawn criticism from staff, unions and MPs after cutting 12,000 workers with Huw Merriman, chair of the Transport Select Committee, claiming the airline is a “national disgrace” and following a “fire and rehire” policy.
With air travel through Heathrow airport down 82% this September compared with the same period in 2019, it’s clear the coronavirus has tanked the airline industry. Virgin Atlantic, for instance, has been much criticised for its response and just about muddled through, now operating at 6% of its pre-pandemic capacity. The question now is whether Doyle can course-correct in time – or will BA be permanently grounded?
Before BA, Britain was spoilt for choice. Prior to 1974, British Overseas Airways Corporation, British European Airways, and regional airlines, Cambrian Airways and Northeast Airlines, claimed ownership of the country’s skies. Following decades of disputes between the airlines, all four were (briefly) brought together under one banner as a public-owned entity before the Conservative government privatised British Airways 13 years later, in 1987.
It was BA – along with Air France – that operated the supersonic Concorde flights from the late ‘70s until flight BA002 from New York-JFK to London-Heathrow served as Concorde’s swan song on 24 October 2003.
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