Air France-KLM installed a triumvirate of executives led by its finance chief to run the strike-hit airline while it searches for a new CEO, following a standoff over staff pay, reports Reuters.
Tuesday’s move is designed to fill a gap left by the abrupt departure of chief executive Jean-Marc Janaillac after Air France staff earlier this month rejected a pay proposal aimed at ending a series of strikes that have resulted in heavy losses.
In a statement ahead of an annual shareholder meeting, Air France-KLM said the new three-person executive committee would comprise group finance director Frédéric Gagey, who would take on the role of chief executive, and the existing heads of the two national brands that merged in 2004: Air France and KLM.
Shares in the group dropped after the announcement and were down 3.3 percent at 1344 GMT.
Bernstein analysts said in a note that while the move provides some stability, a formal successor was still required.
“Whoever that person is will face significant challenges throughout the business, from competitive threats in AF KLM’s key markets, an emboldened union in France which is likely to ramp up its demands and the lack of a coherent long-term strategy,” they wrote.
Air France-KLM also named board member Anne-Marie Couderc as non-executive chairwoman.
“This transitional governance structure is established for the shortest-possible period required to effectively complete the succession process for the roles vacated by Jean-Marc Janaillac,” the company said in a statement.
The interim leadership of Europe’s second-largest network carrier by revenue will face French unions emboldened by the exit of Janaillac, who announced his resignation on May 4 after putting his job on the line as French staff voted on pay.
The French government, already locked in a battle over reforms at state railway operator SNCF, has said it will not bail out Air France - where a protracted dispute between management and unions over pay has resulted in 15 days of walkouts this year, costing the group 400 million euros ($479 million).