LONDON – Two top European airline executives announced plans to quit on Monday, with the tough Continental economy exacting a heavy toll on some of the carriers least able to cope.
Aer Lingus, the Irish carrier that’s spurned two takeover bids from Ryanair Holdings, said Dermot Mannion, chief executive, is quitting with immediate effect. Chairman Colm Barrington will hold the CEO role until a successor has been found.
“My decision to step down will allow a new CEO to bring fresh thinking and new ideas to the business,” Mannion said in a statement.
Barrington said Aer Lingus will focus on maximizing revenue and reducing operating costs while maintaining a strong balance sheet.
Aer Lingus has had a difficult time doing that, at least at the top and bottom lines: it lost 107.8 million euros ($146 million) during 2008, and the group has warned that in 2009, average fares will drop at least 10% and cargo revenue will fall by up to 30%.
Its balance sheet has been relatively strong, however, as the airline finished the year with 653.9 million euros in net cash, one of the reasons it’s spurned takeover bids from Ryanair.
Ryanair, which owns nearly 30% of Aer Lingus, has fought bitterly against its fellow Irish carrier, though it’s unclear that even if Aer Lingus wanted to be bought by Ryanair that it could due to antitrust concerns.
The European Commission earlier rejected the Ryanair-Aer Lingus combination on concerns about dominance of traffic in the country.
Shares of Aer Lingus rose 5.3% to 0.70 euros a share – or precisely half of Ryanair’s previous bid.
Meanwhile, no-frills carrier easyJet said its chairman, Colin Chandler, will resign on July 1. Chandler had been chairman since 2002.
Chandler had said back in February that he planned to leave.
David Michels, the senior independent director, will be interim chairman from July 1 until a permanent successor has been planned.
The U.K.-based airline also said Michael Rake will join as deputy chairman, before Chandler leaves. Rake is the chairman at BT Group and previously was chairman of KPMG International.
EasyJet’s management team has clashed with the group’s founder and dominant shareholder, Stelios Haji-Ioannou, who has criticized the group’s accounting for slots at London Gatwick and has pressed for a dividend by 2011.
In a statement, Haji-Ioannou said he “participated” in making the appointments and looked forward “to working more fully with Sir David and welcoming Sir Michael on the board.”
EasyJet separately on Monday reported traffic statistics for March, and like many of its peers reported a slump in traffic, down 6% to 3.49 million passengers. Its load factor, a measure of seats filled to those available, fell by 2.8 percentage points to 84.7%.
The airline blamed the movement from Easter into April from March for the traffic fall.
Over six months, its load factor has climbed by 1.7 percentage points and passenger traffic has climbed by 2.9%.
Shares of easyJet rose 4.3%.
Separately, Haji-Ioannou told the Financial Times that he will return to the commercial property market, seeking out London office buildings to turn into hotels and offices for use by easyHotel and easyOffice.