Etihad hires British defence buyer as new CEO
Airline pursuing strategy review
ABU DHABI, Sept 28, (RTRS): Abu Dhabi has recruited Britain’s top defence buyer to run troubled Etihad Airways which is rethinking an aggressive expansion strategy that led it to huge losses last year.
Tony Douglas, who has also run Abu Dhabi and London Heathrow Airports, will join Etihad as group chief executive in January from Britain’s Ministry of Defence, the airline said in a statement on Thursday.
Douglas’ decision to quit the ministry, two years after being appointed by then Prime Minister David Cameron to overhaul the running of Europe’s largest defence procurement budget, was unexpected.
Analysts said it signalled the difficulties of reforming Britain’s 16 billion pounds ($21.5 billion) a year defence equipment plan.
“If the rainmaker who was brought in as an outside businessman is leaving, that is not good news for the MOD,” said UK defence analyst Francis Tusa.
His departure leaves a void just as Britain plunges into a war of words with one of its biggest defence equipment suppliers, Boeing, over a trade row that could affect aerospace jobs in Northern Ireland.
Douglas replaces veteran Australian CEO James Hogan, who developed Etihad into an aggressive rival to Dubai’s Emirates and Qatar Airways over a 10year period. Hogan’s departure was announced in January.
Douglas will likely face the daunting task of deciding what to do with what remains of Etihad’s sprawling investments in foreign airlines Virgin Australia, Air Seychelles, Air Serbia, and India’s Jet Airways.
Problems with its investments in troubled European airlines and provisions on aircraft plunged the airline into a $1.9 billion loss last year, its first since 2010.
Etihad has already said it would no longer financially support Air Berlin and Italy’s Alitalia, two of its prized investments. Both airlines have filed for administration this year, and Etihad sold its stake in a third European carrier, Darwin, in July.
Chairman Mohamed Mubarak Fadhel al-Mazrouei said Douglas was “keenly familiar with Etihad’s challenges and opportunities in a rapidly changing industry.”