Lufthansa Names Carsten Spohr Chief Executive, Succeeding Franz

Deutsche Lufthansa AG (LHA), Europe’s second-largest airline, said its supervisory board today appointed 47-year-old internal candidate Carsten Spohr as chief executive officer to succeed Christoph Franz.

Spohr, who has headed Lufthansa’s main passenger airline unit since January 2011, will become CEO on May 1, the Cologne, Germany-based company said in a statement. Franz said in September that he’d quit the carrier in May to become chairman of the supervisory board at Swiss drugmaker Roche Holding AG.

Franz, 53, drew criticism from employees as he sought to wring savings from Lufthansa in order to raise operating profit to 2.3 billion euros ($3.1 billion) by 2015. The program spans 3,500 job cuts to less generous retirement benefits and travel perks, and the animosity it provoked may have led him to announce his departure after less than three years as CEO.

“As a Lufthansa man born and bred, I view the appointment as both an honor and an obligation,” Spohr said today. “I am convinced that the company is on the right track. Together, we will make our company resilient and ready for the future.”

The change of guard comes as Lufthansa seeks to fend off competition both from discount rivals that are capturing market share on European routes and Gulf carriers eating into the more lucrative long-haul business. The airline is moving short-haul services outside Frankfurt and Munich to low-cost unit Germanwings and upgrading first and business class cabins to make up lost ground on intercontinental operations.

Lost Vision

“Europe’s big-three airlines have fallen behind while focusing on cost-cutting,” said Joern Grotepass, a consultant at AT Kearney who specializes in aviation. “They have to an extent lost their vision.”

Lufthansa ranks behind European No. 1 Air France-KLM (AF) Group by traffic and ahead of International Consolidated Airlines Group SA (IAG), the owner of British Airways.

Spohr will give up his position at the passenger airline unit when taking the CEO post, with a successor at the division to be identified by the end of April, Lufthansa today.

Franz hammered out joint ventures for trans-Atlantic flights with United Continental Holdings Inc. (UAL) and for Asian routes with All Nippon Airways (9202), and has said the carrier may team up with China Airlines Ltd. in a similar fashion.

Franz, who lives in Zurich and commutes to Frankfurt, has said working at Roche will make it easier for him to have time for his wife and five children.

Born in Wanne-Eickel in Germany’s industrial heartland, Spohr earned a captain’s license for flying Airbus Group A320-series planes before taking over Lufthansa’s personnel-recruiting department in 1994.

From 1995 to 1998 Spohr was personal assistant to then-CEO Juergen Weber, and was appointed to the management board of the passenger airline in 2004. He started heading the unit seven years later, when he was also promoted the management board.

Spohr is married and has two daughters.

To contact the reporter on this story: Richard Weiss in Frankfurt at rweiss5@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net

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