Retiring American Airlines CEO Doug Parker is replaced by Robert Isom
Doug Parker, CEO of American Airlines Group, Inc., will step down on March 31, the company announced on Tuesday, sending its shares up 2% in morning trading.
After taking over as CEO, Isom will join the airline’s board of directors.
Since taking over as president in 2016, Isom has handled all aspects of the airline’s operations, including planning, marketing, and pricing.
Omicron coronavirus variety poses operational hurdles, but the industry has recovered from the pandemic lows.
In order to repair American’s balance sheet, Isom has to deal with the highest debt in the airline sector, which has been left by the epidemic. Additionally, he’ll be expected to work on improving relations with the company’s labour unions.
According to Isom in a recent interview, American will focus on getting back to profitability as quickly as possible and delivering a consistent service. He also plans to pay off a large portion of his debts.
We’ll be focusing on ensuring that we have the right amount of leverage,” Isom said.
However, a full rebound in travel demand is required before a return to profitability can be achieved. Isom stated that while domestic business remained strong, new travel restrictions following the discovery of the Omicron version had impacted demand in some international markets.
“If there’s anything, it just delays recovery,” he explained.
Prior to and throughout the pandemic, 58-year-old Isom has played a pivotal role in devising the American strategy.
According to Jefferies analysts, the company’s strategy of fleet renewal and alliances would not be impacted by the incoming CEO’s experience and background.
Considering Mr. Isom’s long connection with Mr. Parker, this transfer was probably in place for a long time,” they stated in a memo.
Thoughtful and well-thought-out SUCCESSION
A “thoughtful and well-planned multi-year process” led to Isom’s promotion as president in 2016, according to a letter from Parker to workers.
Parker, 60, believes the transition might have occurred sooner if the airline industry hadn’t been crippled by the pandemic.
The recovery from the pandemic is well under way, he said, and “now is the right time to make the transition.”
Parker, one of the airline industry’s longest-serving CEOs, has a reputation for supervising industry mergers and crisis management.
Prior to the September 11th terrorist events, he was in charge of America West Airlines. In 2005, America West merged with US Airways, and Parker remained CEO of the combined firm.
After the merger of American Airlines and US Airways in 2013, he was named chairman and CEO of the airline.