Deutsche Lufthansa has announced the surprise departure of chief executive officer Christoph Franz, who will become chairman at Swiss drugmaker Roche, leaving the German airline in limbo as it works on a turnaround. Franz, whose term expires on May 31st next year, told Lufthansa he was not available for an extension, the Cologne- based airline said in a statement today. The company didn't announce a successor.
Franz, who will take over from Franz Humer at Roche, took the top job at Lufthansa in 2011 and embarked on a savings program that included 3,500 job cuts and a renewal of the fleet with more fuel-efficient models. Humer led Roche for more than a decade.
“This is the right time for change in leadership,” Franz said, adding that he opted to depart for “professional reasons.”
“Taking the decision was anything but easy after 15 years at the Lufthansa Group.”
Lufthansa rose as much as 20 cents, or 1.4 per cent, to €14.14 in Frankfurt this morning. Before today, the stock had declined 2.1 per cent this year, valuing the airline at €6.4 billion.
Franz is leaving half-way through the so-called score program, a plan to lift operating profit to a record €2.3 billion by 2015, which includes moving many short-haul flights to discount unit Germanwings.
Among possible successors for Franz is Carsten Spohr, who leads the Lufthansa passenger subsidiary, the company’s largest unit, and is a trained pilot. “It’s disappointing that one of the key protagonists in pushing through the score program is departing before its completion,” said Donal O’Neill, an analyst at Goodbody Stockbrokers with a “buy” rating on the stock. “But I suspect there are plenty of internal and external candidates who can take up the role.”
Lufthansa is preparing to announce as soon as this week its biggest fleet order ever, with more than $14 billion in purchases planned from Boeing, the world's biggest planemaker, and Airbus.
Bloomberg