US Airways Appoints Siegel CEO, President
US Airways named travel industry veteran David N. Siegel president and CEO. As of March 11, he has taken on the duties temporarily assumed by chairman Stephen Wolf in November, following Rakesh Gangwal's sudden departure. Siegel, who also becomes a board member of both the parent company US Airways Group and the airline itself, comes from Avis Rent A Car System, where he had been CEO and chairman of the Cendant Corp. subsidiary.
Siegel is charged with overcoming US Airways' full plate of current challenges. The carrier has not finished in the black since the second quarter of 2000—it dropped nearly $2 billion last year—and is trying to reduce its costs, which are among the highest in the industry. It also faces intense competition from low-fare carriers and is seeking alliance partners in the wake of last year's failed merger with United Airlines.
The carrier's strategic overhaul includes a focus on regional jets, an area Siegel knows well from his successful four-year tenure in the late 1990s as president of Continental Airlines' subsidiary Continental Express, known now as ExpressJet. However, US Airways pilots remain at odds with management over the number of regional jets to be deployed and Siegel must find common ground to push forward the carrier's rebuilding program. "David did wonderful things at Continental Express, basically starting their regional jet program, and he understands just how critical it is to have regional jets in the market," said Deborah McElroy, president of the Regional Airline Association, a Washington, D.C.-based advocacy group for regional jet operators. "Hopefully, he will provide the necessary rationale for pilots to agree to more RJs."
Before joining Avis, Siegel served briefly as president and COO of Budget Group. "While this is a particularly challenging time for the airline industry, I'm delighted to return to commercial aviation," Siegel stated. "I have long viewed US Airways as an airline with a strong franchise and tremendous potential." Wolf, meanwhile, remains chairman of US Airways Group and US Airways Inc. in a non-executive role.
At Avis, current president and COO Robert Salerno will lead the company until Siegel's successor is named. "After a very successful record as an airline executive, David could not resist the opportunity to head up an independent, publicly traded airline," stated John Chidsey, chairman and CEO of Cendant's vehicle services division.