Newsmaker: Sabre Chief Switches Continents To Accept Senior Post At Swissair

In a move that surprised the airline and technology industries on both sides of the Atlantic, Swissair last week tapped Sabre Travel Information Network president Jeff Katz as its new head.

The 41-year-old Katz will assume the role of chief operating officer on April 1, and will move up to chief executive of the airline on Jan. 1.

The appointment of an unknown "American from American" to head what has been a traditional bastion of Swiss nationalism and pride has caused some consternation in Europe. The Financial Times in London headed its story with a surprised "Swissair, one of the proudest symbols of the Swiss economy, has hired an American chief executive."

And calling BTN to ask who Jeff Katz was, journalist Victor Breu of Zurich's Tages Anzeger noted that although Katz was nominated by SAirGroup chief executive Philippe Bruggiser, "several Swissair people have said they don't know him, and even the senior executive staff doesn't know him."

But perhaps that is precisely the point. As the European airlines head into an era of deregulation and cost efficiency, they seem to be targeting American Airlines as a source of knowledgeable executives who have been there, done it and survived. The day before Katz's hiring by Swissair, another former American executive, Frederick Reid, was promoted from executive vice president to president and COO of Lufthansa. One industry insider said the chief executive officer position at Swissair had first been offered to American's former passenger sales vice president, Jack Williams, who opted to accept an offer from Royal Caribbean Cruise Lines instead.

Breu noted that Katz will need to quickly develop strategies to cut costs and produce international alliances for the Swiss carrier in a free-market environment. The airline faces "a painful process of hard downsizing" of employees earning salaries that are "far too high," and must find international alliances "with a better record than Sabena," he said.

"If he is not successful in the next two or three years, I think Swissair will be absorbed by another airline," Breu said. "This is a tough business, and we need a tough guy."

But Swissair spokeswoman Linda Parseghian said cost cutting was already under control and not the reason for Katz's being brought on board. "Bringing in Americans is done for their skill and knowledge of the American market, and to profit from their experience with the free market," she said.

Katz declined interviews until he becomes an official Swissair employee on April 1. And Swissair's U.S. code-share partner, Delta, declined comment at this point on what having an American Airlines insider will mean to the carrier.

American head of corporate sales Frank Morogiello said that while he "hates to see Jeff go out of our domain, it's a compliment to our company that he has been tapped. American has a reputation for well-trained and experienced managers, and our executives, from Don Carty to Bob Crandall, are always highly rated."

"Europe is going through a deregulation mode, and we have lived through a lot of stuff they are going to have to go through, and learned how to compete in that new environment," Morogiello said. "Europeans still want a full meal on a 40-minute flight, and a lot of things are going to have to change as they reduce cabotage and compete against new low-cost competitors."

Katz was named to BTN's "25 Most Influential Executives of the Year" list in 1995 for his accomplishments at Sabre. His four years at the CRS followed 13 years at American Airlines, where he held positions in marketing and finance before being named managing director of the $2 billion western region.

Sabre, meanwhile, "is in the process of looking for candidates internally and externally" to replace Katz, said spokeswoman Jennifer Hudson. Insiders say Sabre Group president Michael Durham hopes to announce Katz's successor before his official departure on March 31.