August 21, 2017 / 9:06 AM / 10 months ago

Etihad Airways sets new CEO deadline, may join late 2017

ABU DHABI/DUBAI (Reuters) - Etihad Airways has delayed the appointment of its new group chief executive to late 2017 with the hiring of a new boss nearly finalised, the airline said on Monday.

FILE PHOTO: An Etihad Airways Boeing 777-3FX aircraft takes off at the Charles de Gaulle airport in Roissy, France, August 9, 2016. REUTERS/Jacky Naegelen/File Photo

In May, Abu Dhabi’s Etihad appointed executive Ray Gammell as interim Group CEO to replace veteran CEO James Hogan who left on July 1. At the time, Etihad said it was in the “advanced stages” of hiring a permanent successor and would make an announcement “in the next few weeks”.

A source aware of the matter told Reuters that a new group CEO has been hired and would be joining after three months, without giving a name. The source declined to be named as the matter is not yet public.

“The recruitment of a new Etihad Aviation Group CEO is reaching its conclusion with the successful candidate expected to start no later than the beginning of 2018,” an Etihad spokesman said in a statement.

The new CEO faces challenges as Etihad grapples with issues relating to its investments in troubled airlines which contributed to the state-owned carrier reporting in July its first loss since 2010.

That loss included an $808 million impairment associated to investments in other airlines, mainly Italy’s Alitalia and Germany’s Air Berlin.

Etihad began a company wide review last year that has seen funding pulled from Alitalia and Air Berlin, and a stake sold in a third European carrier, Darwin Regional.

Alitalia and Air Berlin have both filed for administration this year.

Etihad continues to hold minority stakes in six airlines from Australia to Europe, including Alitalia and Air Berlin.

The new group CEO would likely have to confront a campaign in the U.S. calling for the United States government to take action against Gulf carriers, including Etihad, over allegations they are state subsidised. The Gulf carriers deny the allegations.

Another issue that might need to be navigated would be the diplomatic rift in the Gulf which broke out in June after the United Arab Emirates and three other Arab countries cut ties with Qatar. The region’s worst diplomatic crisis in years has seen the four countries ban flights to and from Qatar.

Reporting By Stanley Carvalho and Alexander Cornwell, editing by Louise Heavens

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