PanHAM
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AB Hunold Resigns

Thu Aug 18, 2011 9:35 am

Just came over the radio Air Berlin CEO Achim Hunold resigns and names former deutsche Bahn CEO Mehdorn as a possible successor.
Mehdorn would be an excellent choice. Will be interesting to watch this emerging story.
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dazeflight
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RE: AB Hunold Resigns

Thu Aug 18, 2011 9:42 am

Mehdorn has particular strengths in alienating customers and employees, as he has shown at DB. Luckily he's only been proposed a temporary successor. In any case this should be a good day for AB, it was about time Hunold and opens possibilities to put AB back on the track.
 
Ronaldo747
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RE: AB Hunold Resigns

Thu Aug 18, 2011 9:46 am

Quoting PanHAM (Thread starter):
Mehdorn would be an excellent choice

Disagree. It's neither a bad choice nor an excellent choice (see the condition of the Bahn after his demission. Apparently he's only a transition CEO according to the press.

AB might be a takeover candidate ... (for IAG Group?)
 
kiwiandrew

RE: AB Hunold Resigns

Thu Aug 18, 2011 9:48 am

This seems to be coupled on FlightGlobal with another AB story


http://www.flightglobal.com/articles...lash-routes-in-major-shake-up.html


...Air Berlin is to implement a wide-ranging cost reduction plan that will see it cut eight aircraft from its fleet, cancel a number of routes and partially withdraw from regional airports, in a bid to return to profitability....


http://www.flightglobal.com/articles...r-berlin-ceo-hunold-to-resign.html

...Hunold intends to end his tenure as chief executive on 1 September, but said he wishes to remain a non-executive director at the airline....

[Edited 2011-08-18 02:49:52]
 
captaincrackers
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RE: AB Hunold Resigns

Thu Aug 18, 2011 9:57 am

I really wonder whether BA/IB have the cash to acquire AB. But it certainly is suspicious that Mehdorn is being touted as a temporary CEO only. Perhaps Hunold can bear to see his baby be sold, but wasn't prepared to handle the sale himself? Exciting times for some.
 
PanHAM
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RE: AB Hunold Resigns

Thu Aug 18, 2011 10:00 am

Well, Mehdorn has left Deutsche Bahn in an excellent condition. The company makes money in all sections, long distance passenger trains, urban passenger services and cargo. The transition from the old State Authority where passengers were subjects who had to obey the authoritarian conductor (similar to what they are now on US airlines) to customers has worked. You cannot hold a manager responsible for an inadequate infrastructure when that does not fall under his responsibility.

Mehdorn is the right man to put AB back on track and make it profitable. Only then will the company be a potential take over candidate.

BTW, a CEO is not running for popularity and workers are not promised rose gardens. A CEO's main responsibility is to run a company profitable because only then the jobs are secure and the company can sustain. It has been discussed here many times that Hiunold made more than a good number of mistakes. Be that correct or not, the most recent and disappointing figures have made that decision inevitable.
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dazeflight
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RE: AB Hunold Resigns

Thu Aug 18, 2011 10:22 am

The fact that the S-Bahn Berlin was put into such a shape by Mehdorn's cost-cutting regime that it is not working at full ordered capacity since two years and now has to spend hundreds of million of Euro's to make up for the neglection which generated those great financial number's during his reign is pretty revealing. DB-customers did not have a choice to choose a different company when he made one of his management errors, the flying public will. So, while he may be good for great financial numbers, he clearly lacks the empathy to understand what his customer's want. An excellent choice for a CEO should be able to do both.

[Edited 2011-08-18 03:23:15]
 
captaincrackers
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RE: AB Hunold Resigns

Thu Aug 18, 2011 10:30 am

Quoting PanHAM (Reply 5):
You cannot hold a manager responsible for an inadequate infrastructure when that does not fall under his responsibility.

Haha, you're referring to Mehdorn and yet I'm pretty sure that's what Hunold's fans say about Hunold.

It is highly debatable whether Mehdorn did as great a job at Deutsche Bahn as you claim. Small profits were made at the expense of safety, huge debt run up and still outstanding, budget overruns left, right, and centre, public money being wasted because corners were cut, and just in the past few days a survey that showed something like 70% of Deutsche Bahn staff with no faith in the management structures Mehdorn built. I also recall something about an IPO scheduled for 2004 that still hasn't happened. The question is whether any manager could have done any better at a company of that size and complexity. But then, the same applies to Hunold, and the same will apply to whoever now replaces him at AB.

Quoting PanHAM (Reply 5):
Mehdorn is the right man to put AB back on track and make it profitable. Only then will the company be a potential take over candidate.

I'm not so sure that AB isn't a takeover candidate already. It has had such a mixed bag of priorities over the course of its growth and it should be fairly obvious that with the realignment of those priorities planned for the near future, it'd be the perfect tool for a bigger airline to counteract LH throughout Europe.

Quoting dazeflight (Reply 6):
So, while he may be good for great financial numbers, he clearly lacks the empathy to understand what his customer's want. An excellent choice for a CEO should be able to do both

+1

[Edited 2011-08-18 03:35:20]
 
PanHAM
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RE: AB Hunold Resigns

Thu Aug 18, 2011 10:51 am

Quoting dazeflight (Reply 6):
may be good for great financial numbers, he clearly lacks the empathy to understand what his customer's want. An excellent choice for a CEO should be able to do both.

I do not know if you use the railways but as a regular passenger and holder of a Bahncard50 I can tell you that the service greatly improved over the past years. Regarding your quote about the s-bahn, you obviously do not understand how DB AG operates since it was transformed from a an authority to a PLC (AG). Since then DB AG is a service provider who sells the services to the various states by participating in public tenders. The S-Bahn in Berlin is run on behalt of the state of Berlin by DB AG and according to the conditions lined out in the tender. DB can only provide what Berlin pays for. Simple as that.

Now., luckily, airlines are far from that and they have to be sustainable on their own. Obvisouly, when such a strong personality like Hunold throws the towel they must be in worse shape than they tell. Mehdorn has shown several times that he can turn situations like that.

Quoting CaptainCrackers (Reply 7):
I'm not so sure that AB isn't a takeover candidate already.

You seriously think that the major owners sell before the bride is beautified? Same goes for potential buyers, they could get a majority relatively cheap but they would have to make an announcement to the market and shares would go up immediately. Over half of the shares are free float and that wold make it quite expensive for the new owner.
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captaincrackers
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RE: AB Hunold Resigns

Thu Aug 18, 2011 11:04 am

Quoting PanHAM (Reply 8):
You seriously think that the major owners sell before the bride is beautified?

Yeah. I think it's going to take an outsider to beautify the bride, and I wonder whether Hunold has realized this and that's why he's stepped down.
 
captaincrackers
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RE: AB Hunold Resigns

Thu Aug 18, 2011 11:05 am

All wildly speculative of course...
 
Rara
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RE: AB Hunold Resigns

Thu Aug 18, 2011 11:24 am

I believe Mehdorn is a fine manager. His task at Deutsche Bahn was to make the company profitable so that the government could privatize it, and that's what he did. It's not his fault that political priorities changed during that time.

But it's true that he isn't really known for empathy. Will be interesting to see whether he can create a good customer experience and continue AB's way towards a full-service airline.
Samson was a biblical tough guy, but his dad Samsonite was even more of a hard case.
 
328JET
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RE: AB Hunold Resigns

Thu Aug 18, 2011 12:15 pm

That is the best news about german aviation since ten years in my eyes.

It was about time for him to leave a very long time, but he did not realize...


Good news for AB and rest of the german market.


 
 
r2rho
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RE: AB Hunold Resigns

Thu Aug 18, 2011 12:31 pm

Quoting kiwiandrew (Reply 3):
...Air Berlin is to implement a wide-ranging cost reduction plan that will see it cut eight aircraft from its fleet, cancel a number of routes and partially withdraw from regional airports, in a bid to return to profitability....

Indeed, I think it is interesting to view the resigning and the announced restructuring together. AB will be slasinhg capacity by 1 million seats, remove 8 a/c (I assume sohrt-haul?), and cancel numerous routes. It looks like AB will stop its point-to-point regional flying to re-trench into its hubs. Hunold also very openly criticises the new departure tax introduced this year, which has cost them 45 million in Q2.

IMO however, their problems go far beyond the (certainly harmful) departure tax. They have expanded too fast, have an undefined product in between low-cost leisure and full-service, and have probably tried to enter too many markets at once. Furthermore, for the regional flying they didn't have the right equipment - more Q400's or some RJ's would have been better than so many A32x. The restructuring will be painful and it will be a shame to see them go for certain markets, on the other hand AB cannot continue to lose money forever....
 
SchorschNG
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RE: AB Hunold Resigns

Thu Aug 18, 2011 12:53 pm

I think Mehdorn is a good choice as "interim CEO". He has a good stand as manager of difficult situations. Nobody claims he did everything right at Deutsche Bahn, but probably he did more good than bad in a "company" that was heading towards a dead end fast.
The role as "interim" allows him some unpopular decisions. Also, he is nearly 69 years old, so another year is probably enough before concentrating solely on his golf handicap.

For LH, with Mehdorn taking the hat at BA, the competition will just as strong.

Some people may have forgotten: Mehdorn was Airbus executive back in the pre-EADS days until the mid 1990ies. He managed to change the loss-making command-economy style MBB into a profit-making company, enabling the success of Airbus in the coming years. He has lots of experience in running a company in trouble in a politically difficult situation.
Besides that, he has excellent political connections, much better than anyone at Lufthansa.
From a structural standpoint, passengers are the worst possible payload. [Michael Chun-Yung Niu]
 
Tobias2702
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RE: AB Hunold Resigns

Thu Aug 18, 2011 1:11 pm

Quoting kiwiandrew (Reply 3):

...Air Berlin is to implement a wide-ranging cost reduction plan that will see it cut eight aircraft from its fleet, cancel a number of routes and partially withdraw from regional airports, in a bid to return to profitability....

Indeed, here in detail:;

AB announces a fleet reduction of 8 aircraft and several route cuts, in order to concentrate on its hubs at TXL/BER, DUS, PMI and VIE, a program dubbed "Shape and Size". Less regional airports are to be served.


The following routes are to be terminated from Winter 2011/12:
from FRA: HAM, NAP
from STR: LED
from MUC: CAI
from DUS: ORY
from FMO: STN, GWT, VIE
from CGN: Nador, Tangier, Tunis, Valencia, INN, PMO, NAP
from HAJ: STN
from PMI: FKB, DRS, BSL (routes to be summer seasonal)
from PAD: STN, MAN
from Erfurt: all
+ Malaga, Alicate: scale back in frequencies/routes served during winter

source: http://www.airberlin.com/site/pressnews_dr.php?ID=3137&LANG=eng

--Tobias--

[Edited 2011-08-18 06:20:32]
PA, AF, UK, BA, AB, DL, LH, FR, BD, A3, EZY, DY //// A319/320/346, B733/735/73G/738/744/763, AT4, 146, CR2, DH4
 
something
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RE: AB Hunold Resigns

Thu Aug 18, 2011 1:25 pm

Quoting Rara (Reply 11):
But it's true that he isn't really known for empathy. Will be interesting to see whether he can create a good customer experience and continue AB's way towards a full-service airline.

That's exactly the problem I see with Mehdorn. He would make a great fit for American Airlines, where service doesn't matter and it's just about shifting capital and assets. In Europe however, I am afraid he will ''downsize'' Air Berlin to what he thinks is a profitable company, overlook the market's needs and render Air Berlin an uncompetitive business doomed to fail.

In the airline business, it's really all about marketing. Knowing what the market asks for, what the customers want and winning customer's from the competition over to your business. The second step would be to find ways to lower your cost to offer the product your customers love you for at the lowest cost to your company, the third step would be to find max out your potential (cutting service whilst keeping customers, raising fares etc.)

I'm afraid Mehdorn would skip step 1, start with step 2 and ignore step 3. Of course you can cut all unprofitable routes and start charging for everything, reduce fleet size and cut salaries. But that wouldn't leave you with the profitable chunk of the company, it would drive your existing customers away to the competition. I doubt Mehdorn understands that.
..sick of it. -K. Pilkington.
 
Ronaldo747
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RE: AB Hunold Resigns

Thu Aug 18, 2011 2:08 pm

Quoting PanHAM (Reply 5):
Well, Mehdorn has left Deutsche Bahn in an excellent condition. The company makes money in all sections, long distance passenger trains, urban passenger services and cargo. The transition from the old State Authority where passengers were subjects who had to obey the authoritarian conductor (similar to what they are now on US airlines) to customers has worked. You cannot hold a manager responsible for an inadequate infrastructure when that does not fall under his responsibility.

Well, under his responsibility fell bad punctuality and nasty customer service .... two things that AB cannot afford!

However, it might be very bad news for Boeing. Mehdorn was CEO of Airbus Germany in the early 90s ....

[Edited 2011-08-18 07:15:28]
 
oneworld77
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RE: AB Hunold Resigns

Thu Aug 18, 2011 3:39 pm

"Shape and Size".

Interesting - BA must have given them the 'Future Shape and Size' folder!!

This is the reshaping that it went through in the middle of the naughties and encompassed preparing the airline for T5 at LHR and reduced consistently delayed flights (not of BG magnitude, but 15 to 30 mins on 60% of flights in one year!) alongwith cutting out inefficiencies.

[Edited 2011-08-18 08:40:58]
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PanHAM
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RE: AB Hunold Resigns

Thu Aug 18, 2011 3:56 pm

Quoting Ronaldo747 (Reply 17):
Well, under his responsibility fell bad punctuality and nasty customer service .... two things that AB cannot afford!

simply not true. The service on long distance ICE trains is much better than it was before his time. That goes for 2nd class as well as for 1st class. I know nasty custonmer service from the old Bundesbahn days but not DB AG. He introduced an airline style loyalty scheme and many more. You cannot hold a CEO responsible for inadequate infrastructure or people killing themselves walking in front of a train which delays 2 hrs. Neither falls under hois responsibility.

The re-structuring of AB has begun already, they focus, it seems, on their hibs. That makes only sense. Going head on with LH on a spoke to spoke route like FRA/HAM is crazy. That's burning money, nothing else.

Quoting Ronaldo747 (Reply 17):
However, it might be very bad news for Boeing. Mehdorn was CEO of Airbus Germany in the early 90s ....

...and you think because that he buys Airbus?   I think that Boeing will not be hurt. First because managers don't buy assets because of fond feelings but because the assets must make money and second, Mehdorn will be interim, I do not think that he will get much involved in such matters, which have to be firmed by the board anyhow.
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Joost
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RE: AB Hunold Resigns

Fri Aug 19, 2011 7:57 am

Quoting Tobias2702 (Reply 15):
from FMO: STN, GWT, VIE

The cancellation of STN and VIE leaves FMO with solely domestic and vacation destinations.

Flights to major international cities or hubs haven't been overly successful from FMO.

AF: CDG-FMO, start 2008, end 2009
EA: AMS-FMO, start 2006, end 2007 (demise of EA)
AB: Tried and cancelled FMO and TXL in 2010, now STN and VIE in 2011
QW (BlueWings): Flew FMO-SVO, company folded in 2010
X3: Flew FMO-VCE, cancelled in 2008

I wonder what the future will bring for FMO. It has a good catchment area, but of course competition is fierce: DTM, BRE, HAJ, DUS; they're all within a 90 minutes drive.

Quoting Tobias2702 (Reply 15):

from FMO: STN
from PAD: STN
from HAJ: STN, MAN

This also means the complete withdrawl from AB from STN and MAN. I noticed that on their website, LGW is now listed as "London" (iso London - Gatwick). I wonder if they'll launch more new LGW services, especially since their OneWorld future. They are late, however, when it comes to DUS-LGW, which should have been one of their prime London-routes. Now U2 has a double-daily service and this makes a launch way more difficult.
 
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InsideMan
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RE: AB Hunold Resigns

Fri Aug 19, 2011 8:10 am

Quoting Ronaldo747 (Reply 17):

However, it might be very bad news for Boeing. Mehdorn was CEO of Airbus Germany in the early 90s ....

and quite involved in the decision to launch the A320

Quoting PanHAM (Reply 19):
...and you think because that he buys Airbus? I think that Boeing will not be hurt. First because managers don't buy assets because of fond feelings but because the assets must make money and second, Mehdorn will be interim, I do not think that he will get much involved in such matters, which have to be firmed by the board anyhow.

I know at least one Airline CEO who is a former Airbus employee and one condition for him was, that this airline would never again aqcuire anything Boeing builds. Not saying it is the case here, but it does happen elsewhere...
 
LAXintl
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RE: AB Hunold Resigns

Fri Aug 19, 2011 8:14 am

It seems to me the casual observer on this side of the Atlantic after having previous had many years of business dealings with LTU, that today's Air Berlin is a carrier that is rather confused.

Is Air Berlin;
a) European LCC
b) Leisure/holiday operator
c) Alternate German long-haul carrier
d) A network carrier fitting the Oneworld alliance

Seems to be Air Berlin is trying to do all, but failing at the moment. Seemingly Air Berlin could do anyone of the above potentially quite well individually, however in combination the diversified operation, network, product and fleet is simply causing too much complication and expense.
From the desert to the sea, to all of Southern California
 
Joost
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RE: AB Hunold Resigns

Fri Aug 19, 2011 8:40 am

Quoting Ronaldo747 (Reply 17):
However, it might be very bad news for Boeing. Mehdorn was CEO of Airbus Germany in the early 90s

It can also work out the other way: the shareholders' meeting can be very alerted whenever Mehdorn presents a plan to acquire Airbus aircraft. Shareholders might very well demand the CEO to demonstrate that any Airbus order is indeed best for the Shareholders, and not based on personal preferences.

Quoting LAXintl (Reply 22):
It seems to me the casual observer on this side of the Atlantic after having previous had many years of business dealings with LTU, that today's Air Berlin is a carrier that is rather confused.

Indeed, AB seems to be a bit of the old Air Berlin, the old LTU and the old DBA.
 
PanHAM
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RE: AB Hunold Resigns

Fri Aug 19, 2011 8:41 am

Well, there are other airlines that have such a diversity. Evenm LCCs charter their aircraft to tour operators, so that is not unheard of. LH does that. All airlines today are - if not low cost carriers - low fare carriers, filling up seats that otherwise would fly empty. The long haul division is LTU and still runs under that company for traffic rights reasons.

The real problem with AB was / is that they tried to go against LH head on in too many ways. Their hub in BER is rather unchallenged since the traffic mix there is not what LH wpould need. PMI same story, AB has build up an excellent hub there with all the Germans commuting between the homeland and "their" island. That's a good base to build on. DUS is challenged by LH but with the traffic base there it should be alright for both. VIE is running out of competition with Niki as a strong partner.

They could have saved a lot of money if they hadn't operated that many spoke to spoke routes and going head-on with LH on FRA/HAM was simply stupid. They burned too much money outisde their real domains, especially here in FRA.
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dazeflight
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RE: AB Hunold Resigns

Fri Aug 19, 2011 8:42 am

Quoting PanHAM (Reply 8):
Since then DB AG is a service provider who sells the services to the various states by participating in public tenders. The S-Bahn in Berlin is run on behalt of the state of Berlin by DB AG and according to the conditions lined out in the tender. DB can only provide what Berlin pays for. Simple as that

Berlin paid for a certain standard of services, including carriage size, frequency of services and so on. These standards are not followed by since two years, including weeks of complete service disruption - that is why S-Bahn-Berlin und thus her owner, DB AG, had to repay Berlin millions of Euros. The reason for this is the exaggerated profit-seeking-cutlure introduced by Mr. Mehdorn, who actually thought it's normal that a company that is heavily subsidized by the state (S-Bahn Berlin) should turn huge profits and thus put pressure on maintenance and procurement departements.

And yes, I am using ICE services as well, err, IC, because since more than a year, I have to sit in old Bundesbahn Carriages form Berlin to Leipzig or from Leipzig to Frankfurt as again, cost-cutting pressure has lead to the procurement of substandard-products that have now to be reconstructed for big Euros and thus are not available for public raffic.

I am in no way against profitable enterprises, but Mehdorn has shown that shortterm profits do not necessarily mean long-term profitability.
 
something
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RE: AB Hunold Resigns

Fri Aug 19, 2011 9:10 am

Quoting PanHAM (Reply 24):
They could have saved a lot of money if they hadn't operated that many spoke to spoke routes and going head-on with LH on FRA/HAM was simply stupid. They burned too much money outisde their real domains, especially here in FRA.

Exactly. They should have focussed on their core business and spent more attention on creating their own hubs, establishing their own feeder network. Instead, they tapped into LH domains in an ill-conceived attempt to offer business travellers the same network as LH but overlooking the reasons why LH travellers on certain routes are, and will always be LH travellers. Air Berlin could have scored big serving destinations from German/Austrian/Swiss airports that the Star Alliance group doesn't fly to and by offering attractive transit connections through DUS.

On another note, I think it also would have helped if they had gone through with the renovation of their A330 cabins sooner and if they had chosen a little less aggressive colors. Just as tourists are just ''by-catch'' to LH, business travellers should be the ''by-catch'' to AB. That's a good niche for them to fill and even though it's generally lower yielding, you can still make money with it.
..sick of it. -K. Pilkington.
 
Burkhard
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RE: AB Hunold Resigns

Fri Aug 19, 2011 9:12 am

Quoting PanHAM (Reply 5):
Well, Mehdorn has left Deutsche Bahn in an excellent condition. The company makes money in all sections, long distance passenger trains, urban passenger services and cargo. The transition from the old State Authority where passengers were subjects who had to obey the authoritarian conductor (similar to what they are now on US airlines) to customers has worked.

I usually follow your arguments, but you must live in another part of this globe than I do ( I assume we live not more than 50 km apart). I myself use the train rarely, but my father and my wife do frequently. The last 10 times I took them from Mainz main station, only once a train was within 5 minutes on time, average waiting time for them to finally arrive 90 minutes, arround four hours happend twice. The reason of these very long delays was something Mehdorn introduced. Before him, the ICEs ran the same route exactly every hour. So, if a train is late, it does not matter, you get the next. Or you even are lucky end get another delayed one early - using a fixed pattern without tickets that stick you to a given train allows passengers to freely float through the system. This concept has been broken up by Mehdorn, with special connections running with no interchange possibilities, who did all possible to remove flexibility - and thus damaged the German railway system severely.

Quoting CaptainCrackers (Reply 7):
I'm not so sure that AB isn't a takeover candidate already. It has had such a mixed bag of priorities over the course of its growth and it should be fairly obvious that with the realignment of those priorities planned for the near future, it'd be the perfect tool for a bigger airline to counteract LH throughout Europe.

Given the chance that all stocks currently are almost for free...

Quoting PanHAM (Reply 8):
I do not know if you use the railways but as a regular passenger and holder of a Bahncard50 I can tell you that the service greatly improved over the past years.

Again, not my experience, nor that of any of my colleagues, who changed from car to rail 15 years ago because railway was more reliable, and now changed back because train arrivals have got unpredictable and they missed too many important meetings due to many hour delays...

Quoting PanHAM (Reply 8):
Same goes for potential buyers, they could get a majority relatively cheap but they would have to make an announcement to the market and shares would go up immediately.

Go up from current 2,35€ by even 20% still makes them cheap.

Quoting SchorschNG (Reply 14):
Besides that, he has excellent political connections, much better than anyone at Lufthansa.

That may be , but he also has a lot of enemies.

Quoting Tobias2702 (Reply 15):
The following routes are to be terminated from Winter 2011/12:
from FRA: HAM, NAP
from STR: LED
from MUC: CAI
from DUS: ORY
from FMO: STN, GWT, VIE
from CGN: Nador, Tangier, Tunis, Valencia, INN, PMO, NAP
from HAJ: STN
from PMI: FKB, DRS, BSL (routes to be summer seasonal)
from PAD: STN, MAN
from Erfurt: all

That's serious. FMO and PAD and Erfurt where strong bases.

Quoting Joost (Reply 20):
I wonder what the future will bring for FMO. It has a good catchment area, but of course competition is fierce: DTM, BRE, HAJ, DUS; they're all within a 90 minutes drive.

Add PAD to that list, which is 40 minutes using the new highway...

Quoting LAXintl (Reply 22):
Is Air Berlin;
a) European LCC
b) Leisure/holiday operator
c) Alternate German long-haul carrier
d) A network carrier fitting the Oneworld alliance

a) Not really, prices are not on Ryanair scale
b) It was, and still is seen as that
c) That is where they burn the money
d) That is their survival chance, if any.
 
r2rho
Posts: 2441
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RE: AB Hunold Resigns

Fri Aug 19, 2011 10:05 am

Quoting LAXintl (Reply 22):
Is Air Berlin;
a) European LCC
b) Leisure/holiday operator
c) Alternate German long-haul carrier
d) A network carrier fitting the Oneworld alliance

Seems to be Air Berlin is trying to do all, but failing at the moment. Seemingly Air Berlin could do anyone of the above potentially quite well individually, however in combination the diversified operation, network, product and fleet is simply causing too much complication and expense.

Your analysis is quite accurate despite the geographical distance. Indeed, they have been trying to do too many different things at the same time, but without a clear strategy laid out. Hence, they lack a corporate image and identity, everyone sees AB as something different, but nobody - starting with AB itself - really knows what they are.
 
PanHAM
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RE: AB Hunold Resigns

Fri Aug 19, 2011 12:36 pm

Quoting dazeflight (Reply 25):
am in no way against profitable enterprises, but Mehdorn has shown that shortterm profits do not necessarily mean long-term profitability.

not wanting to get too much off topic, but that is the job of each CEO. Don't forget, the company is priavtely run but belongs 100% to the Federal Republic. Paying a dividend is paying into the public cash. However you want to see it, fact is, mehdorn turned the company from an authority to a well run corporation fit for the marlket. The latter is something most critics don#ät see, we have a common market which is open for competition, the days of cozy loss making are over. If BEerlin does not like DB, put a tender up and see how the competition will run the show.

With his long time experience and having nothing to prove to anyone, Mehdorn is the right choice for AB to turn things around, he will have 2 years or whatever he wishes and will find a manager in that time who will continue to run AB.

Quoting Burkhard (Reply 27):
Go up from current 2,35€ by even 20% still makes them cheap.

even LH and all other stock is dirt cheap right now and companies are much undervalued, if you take the present market capitalization.

Quoting Burkhard (Reply 27):
Again, not my experience, nor that of any of my colleagues,

well, mine's different but as mentioned, you cannot hold a carrier liable for lack of infrastructure-. DB is not in charge of that and they cannot do anything against people using trains for their suicide.
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captaincrackers
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RE: AB Hunold Resigns

Fri Aug 19, 2011 1:01 pm

Quoting PanHAM (Reply 29):
Paying a dividend is paying into the public cash. However you want to see it, fact is, mehdorn turned the company from an authority to a well run corporation fit for the marlket.

This is just laughable. DB had the cash to pay a dividend because it took public money but didn't provide the service. If DB had had non-governmental shareholders to answer to, the management that presided over the Berlin S-Bahn affair would have been gone before you could say Radreifen. And while Mehdorn had in fact already been fired (because he broke laws, no less), the whole affair unfolded under his watch.

This is precisely what worries people about Mehdorn at AB. While at DB, he tended to cut money from the wrong areas. It's all very well saying S-Bahn Berlin made a profit in 2008, but when your trains' wheels start falling off in 2009, you've got a problem.

I know there is a lot of streamlining to be done at AB. The various strategies need to be made to work together. $10 says Mehdorn ignores all of that and instead decides to sell LTU to Aeroflot for the symbolic sum of $1.

[Edited 2011-08-19 06:04:24]
 
PanHAM
Topic Author
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RE: AB Hunold Resigns

Fri Aug 19, 2011 2:17 pm

Quoting CaptainCrackers (Reply 30):
I know there is a lot of streamlining to be done at AB. The various strategies need to be made to work together. $10 says Mehdorn ignores all of that and instead decides to sell LTU to Aeroflot for the symbolic su

Well, we don't have $ here, legal tender is the €, but I agree with you, LTU would be worth one € if sold to Aeroflot, because a foreign carrier could not use the shell, LTU would lose their traffic rights the very moment the deal is closed. . Besides, if you know a little about corporate law, there are 2 things a CEO or managing director cannot do, unless he owns the company, change the nature of the business and the second item is, he can't sell the shop. That needs a majority vote from the board.

The same quality is your remark about the dividend. The money is made in all categories DB is doing business. But I do not want to go off topic, open a thread in non aviation and we can gladly discuss things there.
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captaincrackers
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RE: AB Hunold Resigns

Fri Aug 19, 2011 2:53 pm

It seems the powers of metaphor are lost on some. My point remains that many, myself included, think that Mehdorn will throw the baby out with the bathwater, nor non-metaphorically, sell, close, or otherwise cut objects of business that have great earning potential, which is what he did at DB to make his figures look good without actually being any good.

Edited to add: I do understand what CEOs can and cannot do under corporate law. But CEOs are in a unique position to exert influence over boards and shareholders, especially when they have been brought in to save the day at a moment's notice like Mehdorn has.

[Edited 2011-08-19 07:56:04]
 
Humberside
Posts: 3223
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RE: AB Hunold Resigns

Fri Aug 19, 2011 4:12 pm

Quoting Joost (Reply 20):
This also means the complete withdrawl from AB from STN and MAN

Not seen anything to say DUS-STN is going
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PanHAM
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RE: AB Hunold Resigns

Fri Aug 19, 2011 4:40 pm

Quoting CaptainCrackers (Reply 32):
It seems the powers of metaphor are lost on some. My point remains that many, myself included, think that Mehdorn will throw the baby out with the bathwater, nor non-metaphorically, sell, close, or otherwise cut objects of business that have great earning potential, which is what he did at DB to make his figures look good without actually being any good.

Could be that your metaphor is without any power, thought about that?

Mehdorn left DB in a much better shape than it was when he took the helm. Again, this is not a thread about nGerman rail but Air Berlin. But I can tell you something from my experience last year on a winter day in CGN when the ICE train to BRU termindated there because of a technical and weather. I had a meeting in Liege, but it made no sense to use the Thalys because the people I was supposed meeting there could not make it inbound from the Uk either. I took the next back to FRA, got a fully refund and kept the DB bonus and status points. Customer service as it ought to be and which would have been unthinkable with the old Bundesbahn.

Now people making comments about Mehdorn that he will cut down on servicing AB aircraft. That is the same rubbish as saying that he sells parts of AB. He can't, I mentioned that before, such matters need board approval and the state secretaries in the supervisory board of DB AG approved all that "evil" you claim Mehdorn did and they did only what was sacntioned by the transport minister and the cabinet . Get a lesson on what a CEO can do and what he cannot do. If Mehdorn leaves AB is the same shape he left DB AG then there#s nothing to worry about.
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Tolmachevo
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RE: AB Hunold Resigns

Fri Aug 19, 2011 6:17 pm

Quoting PanHAM (Reply 8):
I do not know if you use the railways but as a regular passenger and holder of a Bahncard50 I can tell you that the service greatly improved over the past years. Regarding your quote about the s-bahn, you obviously do not understand how DB AG operates since it was transformed from a an authority to a PLC (AG). Since then DB AG is a service provider who sells the services to the various states by participating in public tenders. The S-Bahn in Berlin is run on behalt of the state of Berlin by DB AG and according to the conditions lined out in the tender. DB can only provide what Berlin pays for. Simple as that.

As a Bahncard 100 holder, I can tell you that approx 30% of my annual price is refunded in ''compensation" for delays of at least one hour...

The service is a lot worse, I can tell you that
 
328JET
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RE: AB Hunold Resigns

Tue Aug 23, 2011 7:40 am

Quoting Ronaldo747 (Reply 17):
However, it might be very bad news for Boeing. Mehdorn was CEO of Airbus Germany in the early 90s ....

Hmm, i did not think about it, but it might be true.


But also, we will see a very interesting competition between LH and AB now...

The reason?

Mr. Franz, the CEO of LH, was fired by Mr. Mehdorn during his time at the Deutsche Bahn some years ago...
I think that is still in Mr. Franz´ mind...


 
 
JU068
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RE: AB Hunold Resigns

Tue Aug 23, 2011 8:24 am

Does anyone know what aircraft are going to be parked? 737s?