Exclusive: Airbus to create two new czars as reorganization takes shape

September 28, 2016 12:09 PM EDT

A flight test engineer holds an Airbus Group flag after the first flight of the Airbus A320neo (New Engine Option) in Colomiers near Toulouse, France, September 25, 2014. REUTERS/Regis Duvignau/File Photo

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By Tim Hepher

BARCELONA (Reuters) - Airbus Group (NYSE: AIR) Chief Executive Tom Enders is extending a promised overhaul of Europe’s largest aerospace group by promoting two top managers to oversee crucial functions like engineering as they usher the company into the age of Big Data.

The plan marks a further shake-up at the top after it emerged last week that Enders plans to make Fabrice Bregier his No. 2 by appointing him as group chief operating officer, on top of his role as head of the dominant Airbus planemaking unit.

Guillaume Faury, who leads Airbus Helicopters, is expected to have group-wide responsibility for engineering within the company's plan to introduce more digital methods into its operations, the sources said. They asked not to be named because the plan has not been formally approved.

Nine months after arriving from Germany's Siemens , Dirk Hoke, the head of Airbus Defence & Space, the group's second largest division, would be awarded oversight of program management and new services as part of the plans to reshape the way Airbus develops, produces and supports aircraft.

The proposal builds on efforts to knit together a once faction-ridden company and mark an end to what Enders described in the past as "fiefdoms" inside the group, whose products range from jetliners to satellites and choppers to fighter jets.

Airbus Group (NYSE: AIR) declined comment. An announcement on the widely anticipated overhaul could come later this week.

Enders said in a letter to staff last week that organizational changes would be finalised soon, adding "lean structures" and speedy decision-making were both priorities.

Group-wide roles have historically struck a sensitive note inside the Franco-German-led firm, because they step across business lines previously identified with national priorities.

It was not immediately clear exactly what role the overlapping business heads would play in each other's divisions, each of which faces pressing industrial challenges and can ill afford any loss of focus, according to analysts.

But people familiar with the plans said daily control of standalone projects such as the new Airbus A350 or troubled A400M military plane would stay in their respective divisions.

Insiders say it is not, in the immediate term, chiefly seen as a cost-cutting exercise but that it would prepare the ground for modernization plans relying on digital design, production and support methods that would also require some new investment.

Job cuts have not been ruled out, however, particularly as a result of slow demand for A380 jetliners and civil helicopters.

Others say it strengthens Enders' grip after longstanding tensions with Bregier, who is expected to give up his title as chief executive of the Airbus commercial unit while remaining its president and cementing his status as likely next group CEO.

Enders recently named Marc Fontaine the company's first digital transformation officer.

In his wider role, newly recruited Hoke is expected to bring a fresh perspective to program management, which has been a problem area for many planemakers in recent years, and develop new services beyond the traditional job of selling parts.

Aircraft connectivity, for example, was identified as one of the key growth areas in new services for the jet industry at the ISTAT Europe aviation conference in Barcelona this week.

(Reporting by Tim Hepher; Editing by Richard Lough and Susan Fenton)

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