In light of overwhelmingly poor financial performance over the past year, Air France-KLM is being forced to shake up the company a bit, starting with the ousting of Pierre-Henri Gourgeon, the now-former CEO.
Air France announced today that Gourgeon’s position as Air France-KLM CEO will be passed on to Jean-Cyril Spinetta. Additionally, Air France put former defense executive Alexandre de Juniac in charge of Air France
The announcement came amidst reports that Air France was looking to replace Gourgeon in an attempt to pick profits back up to acceptable levels.
Gourgeon, 65, stepped into the role of CEO back in 2009. Since his reign, profits for Air France have reportedly fallen 60%, due in no small part to allegations from safety experts that a lack of proper pilot training resulted in the deadly 2009 Air France crash that killed 228 people.
“Air France is in a delicate situation, and will be all the more so if the macro-economic situation gets worse,” said Yan Derocles, an Oddo Securities analyst in Paris. “Gourgeon wasn’t particularly appreciated by investors and having new leadership could help build confidence and provide an electro-shock for the company.”
The aim of the changes in Air France, the company said in a statement today, is to “improve the group’s operating and financial performance in a context of economic uncertainties affecting the European air traffic,” the statement read.
“In the current economic context, top priority must be given to the recovery and improvement of the performance of Air France and of KLM, which must… better address these challenges.”
In light of the announcement, Air France-KLM shares rose around 6% today before falling back down to a gain of 1.4%.
Sources: Air France-KLM, Bloomberg, Associated Press
[Image: Antoine Antoniol/Bloomberg]