Handelsblatt Exclusive

Etihad To Ditch CEO James Hogan

  • Why it matters

    Why it matters

    With chief executive James Hogan on the way out, Etihad seems set to sell its stakes in loss-making European carriers and rethink strategy, as pressure grows on the Gulf airlines.

  • Facts

    Facts

    • James Hogan, Etihad boss since 2006, has overseen billions in losses in recent years, pursuing a strategy of investing in smaller European carriers.
    • Air Berlin lost nearly €500 million this year, with Alitalia expected to lose €400 million in 2016 and €500 million in 2017.
    • Overall profitability for all Gulf carriers is radically down, with their aggregate net profit expected to reach just $300 million in 2016, compared to a predicted $900 million.
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    Audio

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Etihad Airways Chief Executive Officer James Hogan News Conference
Etihad boss James Hogan is on his way out. Source: Bloomberg

The United Arab Emirate’s national airline Etihad plans to remove James Hogan as its chief executive after a failed spree of acquisitions in Europe, multiple independent sources told Handelsblatt on condition of anonymity.

Mr. Hogan sought to expand Etihad’s presence in Europe, buying a 29-percent stake in Air Berlin, Germany’s second-largest airline, in 2011. The Gulf carrier then purchased Air Serbia and bought a stake in Alitalia three months later.

But Etihad’s European expansion has proven to be a misadventure. The Gulf airline has suffered €2.5 billion ($2.6 billion) in losses from its investments in Europe. Air Berlin alone was €477 million in the red in 2015.

 

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