Flybe, Europe’s largest independent regional airline, has shown three directors the door and merged its divisions as part of the struggling group’s drive to cut costs and stem losses.
New chief executive Saad Hammad, who announced a full review of Exeter-based Flybe’s operations when he took over in August, has moved quickly to restructure the business ahead of his own three-month schedule.
The airline group’s divisional structure, comprising the passenger airline Flybe UK and its leasing operation Flybe Outsourcing Solutions, will be disbanded, with all the operating units integrated.
Three directors running the two divisions and corporate strategy – Andrew Strong, Mike Rutter and Mark Chown – have left Flybe. Paul Simmons will join the company from easyJet as chief commercial officer next month.
Hammad commented: “It has quickly become clear to me that Flybe’s prospects will be significantly enhanced by disbanding the existing divisional structure and integrating all operations into a single, simpler and lower cost operating unit. Today’s announcement facilitates that move and will form an important part of the strategic review of the business which I expect to conclude in November. I look forward to sharing its full conclusions.”
Since the appointment of Hammad, a former director of Air Berlin and easyJet, Flybe shares have crept back up to over 87p, almost double the summer low. The airline has struggled since the economic downturn hit regional businesses hard, while UK aviation taxes have compounded its woes. Pre-tax losses reached £40.7m last year. An existing turnaround plan already aimed to slash £50m a year in costs, including laying off around 500 staff.