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Abu Dhabi, UAESaturday 24 February 2018

Etihad’s James Hogan to step down this year

James Hogan took on the role of chief executive of the Abu Dhabi airline in 2006.

James Hogan became Etihad’s chief executive in 2006. Courtesy Etihad Airways
James Hogan became Etihad’s chief executive in 2006. Courtesy Etihad Airways

James Hogan will step down as president and chief executive of the Etihad Aviation Group in the second half of this year.

According to a statement from the company, its board and Mr Hogan first initiated the transition process last year with the formation in May of the group structure, under which Etihad Airways sits.

Mr Hogan took on the role of chief executive of the airline in 2006 before moving to his current role last year.

“Under his leadership, the company has provided new opportunities for thousands of Emiratis and has been a critical element in the remarkable progress of Abu Dhabi and the UAE. We look forward to James’s continued association with Abu Dhabi in new ways,” said Mohamed Al Mazrouei, the group’s chairman.

The group’s economic contribution to Abu Dhabi last year is estimated at more than US$9.6 billion, supporting the growth of tourism and other sectors in the emirate.

However, it is a challenging time for aviation in the Middle East amid excess capacity and a softening economic climate triggered by lower oil prices.

The company is in the midst of a strategic review, Mr Al Mazrouei said.

“We must ensure that the airline is the right size and the right shape. We must continue to improve cost efficiency, productivity and revenue. We must progress and adjust our airline equity partnerships even as we remain committed to the strategy,” he said.

Mr Hogan led the airline into a series of code shares and seven minority investments in other carriers, including airberlin and Alitalia, to stimulate the growth of its network and passenger numbers. “The last decade has seen incredible results but this only represents a first chapter in the story of Etihad,” Mr Hogan said.

The entire network handles 120 million passengers a year and has 700 aircraft flying to 350 destinations.

Mr Hogan wrote last week in The National that Etihad’s “approach has helped us grow from a US$300 million-a-year airline, to a diversified aviation group which delivers revenues of more than $26 billion”.

This business model has meant that the Etihad group has also had to tackle the challenges facing its partners in parallel with those confronting its own airline.

Last month, Etihad said it would create a new European leisure venture with travel group TUI in a move that will support airberlin’s turnaround efforts. And in a softening of the sometimes contentious Etihad-Lufthansa relationship, a code share was agreed between them last month and a deal for the German national carrier to lease aircraft from airberlin was also finalised.

Etihad is currently working with Alitalia on the next phase of its restructuring plan.

“These assets, along with a realigned organisation, provide more agility and added focus as Etihad enters the next phase of its development,” said Mr Al Mazrouei.

Mr Hogan will join an investment company along with James Rigney, Etihad group’s chief financial officer, who will also leave the company later this year. It is understood that the investment company is based in Europe.

A global search for a new group chief executive and chief financial officer is already under way.

Day-to-day management of Etihad Airways will be unaffected by Mr Hogan’s departure as Peter Baumgartner had already taken over from him as chief executive of the airline in May.

malrawi@thenational.ae

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