Franz admits piloting Swiss will be challenging

Christoph Franz is under no illusions about the challenge ahead Keystone

The chief executive designate of the troubled airline Swiss has said he is fully aware that he will have no easy ride when he settles into the captain’s seat in July.

This content was published on April 20, 2004 - 17:59

Christoph Franz could only laugh when swissinfo asked him how it felt to take up possibly one of the most unenviable jobs in Switzerland.

“I think it is one of the most challenging positions especially in the situation we have at Swiss at the moment,” the German commented.

“But every challenge is also a possibility for success, and I think taking over responsibility for a company with the great image Swiss has is a unique chance you don’t get every day in your professional life, although you have to think about the risks and that’s what I did,” he added.

Franz, who will join the airline on May 1 for a transitional period of two months, said one of his first priorities would be to get to know his colleagues and the staff of Swiss.

“A good start”

“I was fortunate yesterday [Monday] to get to know the most important managers and also the heads of the trades unions, and I think this is a good start,” he told a packed media audience at Zurich airport on Tuesday.

Swiss, which has been described by its critics as being “oversized and underused” has not made a profit since it was founded two years ago, after the collapse of Swissair late in 2001.

And there have been plenty of voices that have argued that Swiss has also lost its way in the jungle of today’s global airline industry.

But Franz, who has considerable experience of turnaround situations, told swissinfo that most Swiss did not realise that their airline had undergone sweeping changes in the recent past.

He hinted that no further cuts to the fleet or to jobs would be made without a close look at the market situation.

“Switzerland is not conscious of the extent of the changes which have happened within Swiss in the past six months,” he said.

Worldwide network

“Swiss has reduced its network in a very considerable way, and today with 80 aircraft we are offering a very impressive worldwide network.”

“We should first of all look and see if this kind of network is accepted by our clients before thinking about redimensioning the network again,” he added.

But he is already certain of the position that Swiss should have in the marketplace.

“It is obvious and clear that Swiss is and will be a quality airline. It has to be of premium quality in the first and business class segments and has to be of adequate quality with competitive prices in its economy class, especially in the European network,” he said.

Chairman Pieter Bouw, who has also been acting as chief executive since the resignation of André Dosé last month, told swissinfo that it had been “quite difficult” to find a successor.

Good team leader

He said that the company had been looking for a person who was a good team leader with people skills, had the character to lead a service organisation, and could implement company strategy while focusing on the bottom line.

“All in all, you take a decision on what you think is in the best interests of the company and that was Mr Franz,” he commented.

Bouw explained that Franz’s mandate would be “normal” for a CEO of a company the size of Swiss.

“It will be to position the airline properly, give it a strategic direction, to give it an EBIT (earnings before interest and tax) result of five per cent of turnover and maintain the quality reputation we have in the marketplace,” he said.

Bouw told swissinfo that it was difficult to say what might change under the new leadership.

“I surely hope that things will go better but I do not want to imply the past was bad,” he said.

“Better things”

“You always strive for better things and I think that with the leadership of Mr Franz, he and the company have the potential to do even better,” he added.

Bouw disclosed that Franz will receive a basic salary of SFr800,000 ($611,360) plus take part in performance-based compensation schemes and receive 100,000 Swiss shares – currently valued at SFr1 million – redeemable from 2008.

“I am very happy to be able to concentrate on the chairmanship again because now I have too many functions, I feel… but it’s working very nicely, so don’t worry about it!” he quipped.

In a related development, Bouw, who is from the Netherlands, said that he intended to step down as chairman at the annual shareholders’ meeting in 2005 and wanted a Swiss to take over.

“I think that Swiss is such an integral part of the economy, the country, the social system and the political system that it’s far better to have a Swiss citizen to be the chairman of the board,” he told swissinfo.

“As far as the CEO is concerned, you just have to find the best person who is available in the world and we’ve found him,” he added.

swissinfo, Robert Brookes in Zurich

swiss

The CEO designate of the airline Swiss says he is well aware that he faces a “challenging” job.

But he argues that every challenge is a chance for success.

Franz will receive a basic salary of SFr800,000 ($611,360).

Dutch chairman Pieter Bouw has said he intends to step down at the annual shareholders’ meeting in 2005.

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