Air France-KLM shares were trading lower Friday, as unions share their discontent with the airline’s decision to appointment a foreign CEO for the first time in the businesses 85-year history.
The incoming CEO comes from Air Canada and has won the support of the company’s shareholders, including the French government.
By 1215 BST, Air France shares were 4.53% lower at €8.64. The stock has been moving mainly higher in recent weeks.
Air France-KLM names new CEO
Benjamin Smith will become the next CEO of Air France-KLM, months after previous chief executive, Jean-Marc Janaillac resigned from the aviator. The move comes as shareholders made it clear they wanted an experienced airline professional to take over the role to help steer the business through a difficult period.
“I am very enthusiastic about this new opportunity,” Smith said. “I am well aware of the competitive challenges the Air France-KLM Group is currently facing and I am convinced that the airlines’ teams have all the strengths to succeed in the global airline market.”
Smith will be in his new role at Air-France KLM by September 30.
Trade unions unhappy with decision
Incoming Air France-KLM CEO Smith, will be the first foreign CEO of the French airline and that’s something that has met with disquiet among the staff and trade unions who represent them.
“Concerning the choice of new chief executive…the trade unions would like to state that it's inconceivable that the company Air France – which has been French since 1933 – would fall into the hands of a foreign director,” a group of trade unions representing the French staff at the airline said in a statement.
However, both the Air France board and the French Government, who holds a 14% stake in the business, are both supportive of the move.
“The arrival of Benjamin Smith is excellent news for the Group,” Air France-KLM non-executive chairman Anne-Marie Couderc said. “Benjamin is a world-renowned leader in the airline sector who successfully transformed Air Canada.”