American Airlines announced the retirement of CEO Doug Parker on Tuesday, as American and the entire industry struggles to recover from the devastating Covid-19 pandemic.
Parker, 60, is a towering figure in the industry and is the longest serving CEO of a major U.S. airline.
President Robert Isom will take over as CEO on March 31, but Parker will stay on as chairman of the board.
He praised Isom and said American is “well-positioned to take full advantage of our industry’s recovery.”
Like all airlines, American has struggled during the pandemic, with recent service disruptions and pre-existing debt issues.
According to CNN, American has lost $14 billion since the start of 2020 (not including federal assistance to it and other airlines), while its debt has ballooned 60% to $36 billion as the company borrowed more to survive the effects of the pandemic.
American was considered especially vulnerable before the pandemic because it had more debt than its rivals.
Parker became the CEO of America West just 10 days before Sept. 11, 2001. He oversaw the company’s merger with the larger — but bankrupt — US Airways four years later, and then again with American in 2013. In an analysis shared with Forbes, Jefferies Financial Group summarized Tuesday’s announcement as a “changing of the reigns but no change in strategy.” It suggested American is well positioned “to take advantage of the post-pandemic recovery in travel.”
American is not the only airline to consolidate over the years: Four major companies control roughly 80% of all U.S. air travel, down from 10 at the start of the century. The Justice Department recently filed an antitrust lawsuit to block the announced alliance between American and JetBlue, which would see them coordinate schedules at airports in the Northeast. Last month the companies filed a motion to dismiss the suit.
“American Airlines CEO Doug Parker to Step Down” (Wall Street Journal)
“American Airlines CEO Parker to step down next March” (Associated Press)
“American Airline Exec Says ‘Most Proud Of Saving Jobs’ During Pandemic, Thanks Labor Unions.” (Forbes)
“Inside The $2.5 Trillion Debt Binge That Has Taken S&P 500 Titans Including Boeing And AT&T From Blue Chips To Near Junk” (Forbes)