Scott Kirby Leaves American Airlines to Become President of United

American Airlines sent out a press release announcing that its President Scott Kirby is leaving American Airlines “effective immediately.” And there was no mention of where he was going or why.

Doug Parker remains Chairman and CEO. Chief Operating Officer Robert Isom, who joined US Airways as COO in 2007, becomes President.

Scott Kirby was part of the America West team — he joined there in 1995 — that acquired US Airways out of its second bankruptcy and then took over at American to run the world’s largest airline. He became US Airways President in 2006, and became President of the combined airline after the merger.

Here’s how American explained the change,

Today’s management changes are the result of the Company’s Board of Directors’ ongoing succession planning process. As 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 act proactively to establish a team and structure that will best serve American for the longer-term future.

Ultimately the US Airways team remains in place and in charge, with Doug Parker there and with the number three becoming number two.

And United sent out its concurrent release announcing Kirby as its new President. It will be interesting to learn the path that led to this change, where he becomes heir apparent to Munoz.

Kirby is a really sharp guy, even though he’s taken American in directions I haven’t been happy with him. I found him to come across as thoughtful and humble — although he’s certainly interested in making decisions on the basis of what can be proven.

Under his watch US Airways stopped serving free water, on the belief that customers wouldn’t choose whom to fly based on soft drinks. US Airways eliminated bonus miles for elites, only to bring them back when other airlines didn’t follow. US Airways was slow to adopt inflight internet, because customers weren’t paying for internet — a decision they had to reverse when they finally saw people booking away from the airline for lack of wifi. He’s been a driver of changes at AAdvantage.

United has spent the last year rebuilding trust with employees and customers. Kirby’s US Airways wasn’t known for strong labor relations.

So while he’s a talented and experienced airline hand, who has run profitable carriers under difficult circumstances, he’s also someone that’s done it via cuts and as a driver at American managing by doing what Delta does — from the frequent flyer program, to the shift that’s coming towards Basic Economy fares which take benefits away from elites and require extra payment for an advance seat assignment.

It remains to be seen whether the hard numbers mentality that he’s become known for — for better and worse — will undermine the messaging that United has worked towards. On the other hand, since United has consistently talked about doing many of the same things as Delta (and American) like Basic Economy, the shift at United has been mostly tone.

Put another way, as they say, “meet the new boss, same as the old boss” this time at both American and United.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. So 2 of the legacy Carriers will be led by ex-America West and the other one by the ghost of Richard Anderson. Sigh…

  2. From the guy that destroyed American, here he comes to take United right back down to Smisek levels.

  3. Having just made UA Million Miler, and being generally happy with the visionary leadership of Munoz, I have renewed interest in seeing UA become an industry leader rather than a follower. Since Munoz took over, they stopped playing the “imitation game” that had them moving with DL in lockstep, but from behind. My hope and educated guess, based on how I have seen Munoz operate to date, is that Kirby has been hired to implement Munoz’s vision and not to bring his failed “enhancements” to UA at a time when things finally seem to be going the right way after the $mi$ek debacle…

    Munoz has the vision and the power to turn things around, and he does not seem like a CEO that takes failure very well. So, Kirby will either get on with the program or his tenure in his new position will be short-lived. If making CEO some day is his ultimate goal, then being a “Yes, Mr. Munoz”-man would get him there…

  4. How is it possible that he didn’t have a non-compete clause that would prevent this type of move?

  5. Andrew posts the question of the day. Who ever heard of a No. 2 not having a contract? And who ever hear of such a contract not having a non-compete?

    Of course, this could’ve been covered in a termination agreement. That would require a Form 8-K filing with the SEC, which would be due in four business days.

  6. Based on this guys historical decisions….he will muck it up at my once #1
    UAL ….dontrob customers to pay shareholders….never wins..always losses in the end.

  7. I’m guessing he was the implementer while Parker was the visionary (visions of people paying premium prices for mediocrity), would you agree?

  8. Why would American offer him this outrageously generous separation package when he’s going to a direct competitor? Why don’t AA shareholders consider this against their interests?

  9. A stupid deal on AA’s part. Parker was all glowing with the departure letter to employees regarding Kirby. It sounded as if he was losing his pal. What kind of business is this: friends of friends? No one, esp. Someone who leaves to a direct competitor is worth 13 million. They should go to jail.

  10. Could only be one of a few things that happened:

    1) Kirby sought out UA and then went back to AA with “UA offered me their President position, are you going to put me in-line for CEO?” For which the Board said, “Ok, bye.”

    2) Board is unhappy with the AAdvatange changes and its lack of effect on the share price. Somebody had to talk the fall and wasn’t going to be Parker.

    3) Kirby irked Parker or the Board somehow (amount of compensation, etc) and they said, “See ya.”

    4) Kirby screwed up something. While not egregious enough for termination, Parker and Board determined to let him go.

  11. This is further proof that the Big 3 are one oligopoly. Who needs a non-compete when there is no competition anyway?

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