MIAMI — Scott Kirby has just been named President of United Airlines (UA), leaving his current post as president of American Airlines (AA) to move to one of AA’s biggest rivals.
In a newly created role as President, Kirby will be responsible for United’s operations, marketing, sales, alliances, network planning and revenue management. Kirby’s appointment with United is effective immediately, and he will report directly to United CEO Oscar Munoz.
“While his credentials speak for themselves, what set Scott apart from the other impressive candidates I considered was his excitement at the passion and enthusiasm he is seeing from all of you over the past few months. Simply put, he “gets” the new spirit of United that you have created, and he is the right person to help all of us seize the opportunities ahead.” Munoz said in a statement.
American will be replacing Kirby with current Chief Operating Officer Robert Isom, also effective immediately. Kirby spent more than a decade as Doug Parker’s right hand man, first at U.S. Airways and then at American, and previously worked under Parker at America West, where Kirby was executive vice president of Sales and Marketing.
Kirby and Parker are widely credited with turning around U.S. Airways after the America West merger and making the combined carrier into a viable business and attractive merger partner for American Airlines.
Isom, conversely began his airline career at Northwest Airlines in 1991 before joining U.S. Airways in 2007 and driving the pre-merger carrier’s operational improvement.
A rare event
These kinds of lateral moves within any industry, particularly when the executive in question leaves for a close rival, tend to attract a lot of attention. First and foremost, the main fallout from this transition is going to be PR, though American will need to work in a new organizational structure on the fly as it continues to sort through the merger.
There is some risk that timelines on merger integration slow down due to weakened protocols and new communication overhead in Isom’s first days. But over time, we would expect very little drop off from Kirby to Isom, as Isom is highly capable and well-liked.
American will take a bit of a PR hit, however, with United receiving a compensating boost. Even after Oscar Munoz succeeded Jeff Smisek at the helm of United, the view of United’s management team overall is decidedly lukewarm, with a few even tainted by the Port Authority corruption scandal under previous leadership. Kirby, by contrast, is one of the truly well known executive superstars in the airline business, and his addition to the leadership team and earnings conference calls will provide a boost for United.
American, by contrast, will have lost said superstar from their team.
As far as substantive changes, Kirby may come in with a more aggressive mindset than United’s existing management team, which could reverse some of the present conservatism in United’s planning. At American over the last year and a half, Kirby has been notable for maintaining a positive view of growth in the current fuel environment. That view often put him at odds with Wall Street, and it will be interesting to see if he maintains the same tenor when speaking for United, or tones down his rhetoric to match that of his CEO.
The other payoff to having Kirby on United’s staff, is that he will help to shore up some of the perception that Munoz is not experienced enough in the airline industry (he previously worked in the railroad industry) by adding his experience and credibility to United’s leadership team.