WESTJET CEO GREGG SARETSKY RESIGNS SUDDENLY.

Ed Sims named new CEO on eve of Swoop launch

WestJet Airlines Ltd.’ s president and chief executive Gregg Saretsky said he is retiring, effective immediately, an abrupt decision that comes in the midst of ongoing labour disputes and just months before the expected launch of an ultralow cost carrier Swoop.

In a statement early Thursday, West Jet said Saretsky, 58, who stepped into the role of chief executive eight years ago, had advised the company that “the time has come for him to retire. I am pleased with the continued growth and profitability we’ve achieved together,” Saretsky said in the statement.

“With plans well underway for the launch of Swoop and the introduction of the 787- 9 Dreamliners on the horizon, as well as the great work WestJetters do each day, I’m confident WestJet will continue to grow to the next chapter and beyond.”

WestJet’s board has appointed the company’s executive vice- president of commercial Ed Sims as its new president and chief executive, effective Thursday.

Sims joined the company in May 2017 after serving as chief executive of New Zealand’s air navigation service provider Airways. He has also held senior leadership positions with Tui, Thomas Cook, Virgin Groups and Air New Zealand, overseeing the airline’s international wide-body business. WestJet shares ended the day down about 4.5 per cent on the Toronto Stock Exchange. The stock has gained just 4.4 per cent over the past five years, well behind the 72 per cent advance of Air Canada and the 21 per cent increase for the S& P/ TSX Composite Index.

Chris Murray, an analyst with AltaCorp Capital, said the sudden change in leadership may have been affected by the ongoing labour issues between WestJet and its new pilots union, the Air Line Pilots Association, International (ALPA).

“I think Gregg has always had a very aggressive if not somewhat antagonistic approach to dealing with the union issues,” Murray said in an interview.

“Part of me wonders if him leaving on such short, abrupt notice isn’t perhaps a recognition on the part of the company that maybe they needed different leadership to carry it forward and build a more constructive environment.”

Negotiations between the two parties have grown tense over recent weeks, with both sides filing labour complaints, and the union calling for fellow pilot unions to impose a so-called “recruitment ban” on Swoop.

This week, the Canada Industrial Relations Board (CIRB) sided with the pilots union and demanded WestJet cease and desist offering two- year leaves of absence that would allow pilots to fly for Swoop. The CIRB decision also prevents WestJet from negotiating directly with members of the bargaining unit over the Swoop- related leaves of absence.

Last week, WestJet announced that Bob Cummings, t he executive in charge of the l aunch of Swoop, would be moving into the role of executive vice- president in charge of strategy and guest services. Steven Greenway, who was previously CEO at reward-U, a low- cost carrier loyalty program under HK Express, would be Swoop’s new president.

Swoop, which is scheduled to begin flying in June, is part of WestJet’s ambitious growth strategy that will see also see it expand internationally with new widebody jets.

While some analysts were surprised by the change, most expect no major shifts in strategy.

“News of Mr. Saretsky’s retirement comes as a surprise to us,” RBC Capital analyst Walter Spracklin wrote in a note to clients Thursday morning.

“Nonetheless, the change appears to be amicable and well-planned, with Mr. Sims being hand- picked and groomed or the job.”