Recent top management movement at American Airlines and
United Airlines might reflect a shoring up of the line of succession at both
carriers, according to analysts.
United's surprise appointment
on Monday of American Airlines president Scott Kirby as its own president
"completes a total revamp of United's management," Cowen and Co. said
in a research note. American, meanwhile, promoted COO Robert Isom to president.
Isom's new role puts him in charge of revenue, as well as
operations, which he already oversaw. In its own note, Wolfe Research called
Isom "a talent that American's board was afraid to lose," who
"counters CEO Doug Parker's style well."
American attributed the changes to its board's "ongoing
succession planning process." Its statement explained internal discussions
that had been going on before Kirby's departure: "As a part of that
process and subsequent conversations regarding career expectations and the
marketability of its executives, the company concluded it would not be able to
retain its existing executive team in their current roles for an extended
period. As a result, the board chose to proactively establish a team and
structure that will best serve American for the longer-term future."
Cowen and Co., which rated the shift as a positive for
United and neutral for American, noted that the succession plan American was
putting in place "may have favored [Isom] over [Kirby]." Additionally,
Parker remains popular with his board and does not appear interested in
vacating his post anytime soon.
United CEO Oscar Munoz, meanwhile, generally has received
kudos from the analyst community. He has overseen a period of operational
improvement, despite being sidelined
by a heart attack and transplant shortly after his appointment in September.
Cowen and Co. said, "Given concerns over [Munoz's] health, the potential
for [Kirby] to eventually be his successor is a real one," although The Wall Street Journal also cited an
unnamed source saying Kirby's appointment "isn't a predetermined path
toward the top job at United."
Kirby's appointment, along with other
recent executive appointments, have brought to United "a bunch of new,
untainted and opinionated talent armed with a working knowledge of the
competition," according to Wolfe Research. While analysts regarded Kirby's
appointment as a coup for United, Parker dispelled any appearance of enmity at
his departure from American. "We would not be where we are today without
his leadership," Parker said of Kirby in a statement. "The more than
100,000 team members of American Airlines, most notably me, will be forever
grateful to Scott."