Search on for Air New Zealand replacement for Luxon

Thursday, 20 June 2019

The outgoing chief executive of Air New Zealand, Christopher Luxon, says he has few regrets about leaving, but has no clear view what his next job will be.

Now that Air New Zealand chief executive Christopher Luxon has announced his intention to step down, attention turns to who might replace him.

Luxon said in announcing his resignation that he would work with the new chief executive - perhaps indicating that the successor has already been identified.

Here are some of the possibilities.

* Air New Zealand chief executive Christopher Luxon announces his resignation

* Air New Zealand executives freeze salaries for at least a year as part of cost-cutting**

Simon Moutter

Christopher Luxon says he will work with the new chief executive to create a smooth transition.

Departing Spark managing director Simon Moutter is seen as a frontrunner for the role by many.

It is understood that Moutter turned down a role with Fonterra, perhaps with a view to another job on the horizon.

Moutter has the benefit of being closely linked with brand New Zealand, something which is clearly important to Air New Zealand. His knowledge and experience with technology would be a benefit, as it is an area Air New Zealand is investing heavily in.

Independent aviation commentator Irene King said the airline would want a New Zealander with a New Zealand accent championing the company.

'You're promoting destination New Zealand, and the New Zealand values because Air New Zealand really does reflect those New Zealand values of friendliness, openness, enjoyment, spontaneity.'

Cam Wallace

It's believed to be unlikely that Air New Zealand will appoint from within.

Could Barbara Chapman become Air New Zealand's first female chief executive?

If it did, Cam Wallace is one of the few potential candidates.

The chief revenue officer at Air New Zealand has been steadily building his profile.

At present, he is responsible for generating Air New Zealand's group revenue of $6 billion.

His responsibilities include revenue management, global pricing, online sales, grabaseat retail marketing, corporate, distribution, government sales and contact centres.

He sits on the Air NZ executive team and leads a team of general managers with a staff of over 1500 across New Zealand, Australia, Asia, Americas and international markets.

Wallace has been taking on public speaking appearances such as at the Nurture Change business retreat.

It would be hard to find another candidate with as deep a knowledge of what makes Air New Zealand work, although another could be chief financial officer Jeff MacDowell, who has an extensive big commercial background. Carrie Hurihanganui has risen through the ranks with operational experience running regional airlines. She manages more than 3500 staff.

Fraser Whineray

Mercury's chief executive has held a range of senior positions in New Zealand organisations. The electricity retailer has done well under his leadership - profit was up 27 per cent in the most recent full year.

He's carved out a focus on renewable energy at Mercury, which may align him well with Air New Zealand's brand.

Fraser Whineray has focused on sustainability and renewable energy.

Barbara Chapman

Former ASB chief executive Barbara Chapman is on the Prime Minister's Business Advisory Council with Luxon.

She's been a strong advocate for women in business, which would fit well with Air New Zealand's aims of improving diversity.

Chapman has walked away from hands-on management recently and focused her attention on governance.

But could she be tempted back for this role?

Air New Zealand is mindful that it hasn't had a woman in the top spot before.

Alison Webster

Qantas international chief executive Alison Webster resigned in April. Another international option could be Josh Bayliss, who is currently chief executive of Virgin.

Therese Walsh may need to step up in the interim.

King did not want to single any candidates out but said Air New Zealand might want someone with significant airline experience.

'The issue this time is that there are extraordinary cost pressures staring to translate through, rippling through the whole global aviation industry and I'm not seeing that experience in other companies gives you experience dealing with cost pressures in aviation - clearly it does but they may want someone who has that extra edge to tinker with the airline business as opposed to market.'

She said the airline's competitiveness had been eroded due to cost pressures and the price of fuel going up.

'We've gone over that hump and we're going down the other side. And they may well be looking for an chief executive who has that kind of experience.'

Lesley Grant

Another Qantas option is Lesley Grant, who is currently group executive of people, culture and corporate affairs.

She has deep airline experience - having started as a flight attendant with Air New Zealand - and has previously said the airline was 'in her veins'.

Mark Dunkerley

The American former chief executive of Hawaiian Airlines and former pilot retired in 2018, after which he planned to go fly fishing in New Zealand before returning to Hawaii.

Dunkerley sat on the board of Airlines for America and the International Air Transport Association, and turned around the ailing Hawaiian Airlines from bankrupcy during his tenure.

Therese Walsh

She's stepping up to chair the board of Air New Zealand but Dame Therese Walsh may have to go a step further and run the company until a new chief executive is appointed.

King said an interim chief executive would be a good option if that person was ultimately suitable for the job.

'You look for stability and consistency over short-term solutions. Clearly there will be a limited number of executives throughout the globe who would be interested in this role. They tend to have very strong affiliations with New Zealand.'

Jeremy Sullivan, an investment adviser at Hamilton Hindin Greene, said the announcement of a transition period had helped to keep the share price stable.

'It's a better strategy to do a transition of knowledge and speed up the learning process of the new chief executive and hit the ground running.

'The worst thing from a board is when people quit suddenly, and usually indicates disagreement behind the scenes.'

Luxon said the new chief executive would need to have clarity. 'That doesn't mean they need to know everything but they need a sense of whether they are going and why they're doing it.'

Communication was important to inspire people. 'They don't just follow you.' The new leader would need to enhance the good things that had already happened for the airline, but also provoke change in the future.

He described the job as the best in the New Zealand corporate world and said he had 'every confidence' the Air New Zealand board would be able to find an excellent candidate to replace him.