Finnair Swaps Executives With Cargotec as Vauramo Named CEO
Finnair Oyj (FIA1S) hired Pekka Vauramo as its new chief executive officer from Cargotec (CGCBV) Oyj, five weeks after previous chief Mika Vehvilaeinen travelled in the other direction to take charge of the crane and forklift manufacturer.
Vauramo joins Finnair on June 1, the Vantaa-based carrier said in a statement today. The 55-year-old currently works in Hong Kong as chief operating officer of Cargotec’s MacGregor unit, a supplier of loading and access gear for ships and ports.
Finnair snapped a four-year run of annual losses last year as its focus on Asian traffic begins to pay off. The carrier said Vauramo’s knowledge of the continent was a factor in his appointment as it builds Helsinki into a hub for travel between Europe and destinations in Japan, South Korea and China.
“We were not trying to find an aviation specialist,” Chairman Klaus Heinemann said at the press briefing. “The most important thing was to find somebody who’s a good leader, a good change-and-process manager, and who understands Asia well.”
Vauramo, who has a master’s degree in mining from Helsinki University of Technology, began his managerial career at Sandvik AB (SAND) of Sweden, the world’s biggest maker of metal-cutting tools, in 1985. He joined Helsinki-based Cargotec in 2007, working in roles including deputy CEO before moving to Hong Kong in 2010.
“Finnair has a desire to grow, we have a good strategy and we know where the growth potential is,” Vauramo said at the briefing in Vantaa. “Investing in new equipment is essential to improving competitiveness amid increasing fuel costs.”
The new CEO will also take charge of a cost-cutting drive begun in 2011 which aims to pare expenses by 140 million euros ($180 million) through 2013 and 200 million euros by the end of next year. He’ll be paid a base salary of 51,500 euros a month, plus an anticipated 30 percent bonus.
Vehvilaeinen, aged 52, left Finnair to head up Cargotec on March 1. The airline’s CEO for three years, he had previously worked in executive posts at phone maker Nokia Oyj (NOK1V) from 1992.
The Finnish government will seek parliamentary approval this spring to lower its 56 percent stake below the current legal minimum of 50.1 percent, Heidi Hautala, minister for state shareholdings, said March 27, according to broadcaster YLE.
“The government taking a more flexible position would enhance our options to grow,” Heinemann said today. “Finnair also has to convince the financial markets that its ability to perform financially will be better and less volatile.”
Finnair traded 0.4 percent lower at 2.71 euros as of 1:05 p.m. in Helsinki, paring gains this year to 14 percent.