EADS/Airbus management changes rooted in 2007 Sarkozy-Merkel deal

The management shakeup at Airbus and its parent EADS that was announced Thursday, which promotes Airbus CEO Tom Enders to chief executive at EADS, marks a follow-through on the Franco-German compromise hammered out in the 2007 summer (ATW Daily News, Jan. 26).

EADS agreed in 2007 to end its clunky dual-CEO management structure and Enders became Airbus CEO with an eye toward stabilizing an aircraft manufacturer then enduring near constant senior management turnover.

Enders, co-EADS CEO in 2007, became Airbus's fourth chief in 13 months in July of that year (ATW Daily News, July 17, 2007). He will now replace Louis Gallois as EADS chief, just as he succeeded Gallois as Airbus head back in 2007. The maneuvering is aimed at allowing EADS and Airbus to operate as efficient transnational companies with clear executive reporting lines while maintaining a delicate Franco-German power balance. Hence, the German Enders takes over from the Frenchman Gallois while Enders will be replaced as Airbus CEO by Frenchman Fabrice Brégier, now Airbus' COO.

Under the 2007 arrangement agreed to by French President Nicolas Sarkozy and German Chancellor Angela Merkel, these nationality/CEO swaps are supposed to occur every five years.

Enders steadied Airbus during a rocky period in which AMF, the French stock market regulator, investigated (but did not charge) company executives for alleged insider trading related to A380 program delays (ATW Daily News, Dec. 21, 2009). He also oversaw disappointing A380 postponements (ATW Daily News, May 14, 2008).

The management changes will take place at EADS' annual meeting May 31. Also at that time, Hans Peter Ring will retire as EADS CFO and Airbus CFO Harald Wilhelm will add EADS CFO to his portfolio.

Brégier has already played a major role in A350 program development (ATW Daily News, Jan. 15, 2009); bringing the next-generation aircraft to market will likely be the central task of his expected five-year term piloting Airbus.