Lufthansa picks Spohr as boss to lead battle on budget carriers
By Victoria Bryan and Maria Sheahan
FRANKFURT (Reuters) - Germany's Lufthansa (LHAG.DE: Quote) has picked Carsten Spohr as its new chief executive, naming a company veteran to lead the battle against low-cost carriers and fast-growing Gulf airlines.
Germany's largest airline has been looking for a new boss since September, when it was announced current CEO Christoph Franz would leave at the end of May to become chairman at Swiss pharmaceuticals company Roche ROG.VX.
It said on Friday that Spohr, who has been head of the carrier's passenger airline business since 2011 and had been tipped to succeed Franz, will take up the post of CEO on May 1.
Shares in Lufthansa rose in response to the news, trading 1.2 percent higher at 17.62 euros by 1319 GMT and outperforming a 0.2 percent gain by Germany's blue-chip DAX index .GDAXI.
"Spohr knows the business. He has shown that he is well-connected and can restructure the group," said Ingo Speich, a fund manager at Union Investment, which holds shares in Lufthansa.
Like other European legacy carriers, Lufthansa is battling competition from budget carriers Ryanair (RYA.I: Quote) and easyJet (EZJ.L: Quote) as well as Gulf airlines like Emirates, which are expanding rapidly in the market for lucrative long-haul customers.
Spohr, a 47-year-old native German from Wanne-Eickel in the country's industrial heartland, will take over in the middle of the SCORE restructuring programme, which aims to improve operating profits to 2.3 billion euros ($3.1 billion) in 2015, compared with 524 million in 2012.
Defining a new strategy for Lufthansa beyond the end of the SCORE programme is seen as his biggest challenge. Continued...