CZAMFlyer

By somebody else; the new guy has yet to sit at his new desk.

Let's not overlook l'elephant dans la chambre: "the Air France-KLM group, which is still facing the prospect of walkouts by Air France employees over an ongoing pay dispute likely to be reignited by the arrival this month of new CEO Benjamin Smith."

tracon

Mr. Smith starts work Monday.
http://atwonline.com/airlines/new-ce...ce-klm-sept-17

24left

Interesting ATWonline post. Thanks for sharing.

longtimeflyin

I'm not sure you understand what truly happens at a corporation when a change of guard happens.

CZAMFlyer

I can easily answer this: I don't at all understand what happens. Good deduction. I do understand you'd like your fellow Georgian Old Boy to be cast in the best possible light, but also realize AF/KLM's past successes and shortcomings can't be pinned on a guy who hasn't yet held the reins.

longtimeflyin

I don't understand what you are saying here.

24left

QUOTE:

"Since taking the helm at Air France-KLM, the group’s new Canadian boss said on Monday that he plans on investing half of his salary back into the company. Benjamin Smith, who came to Air France-KLM from his COO role at Air Canada, said he’d invest part of his salary as a gauge of “confidence” in returning the group to success."

https://thepointsguy.com/news/air-fr...-into-company/

longtimeflyin

Holy moly. Talk about putting your money where your mouth is. I don’t know of a single Chief Executive who has done just that. Usually restricted stock is awarded at no cost to the employee at time of hire, even if that employee is the CEO.

ffsim

Bohemian1

As symbolic as it may be, I still like guys who have skin in the game.

YEG_SE4Life

If someone is willing to pay the price you demand, the salary is probably just about right.

CZAMFlyer

This isn't a very risky decision. I'm sure Smith has received a bunch of restricted stock as you have described; he has simply chosen to invest a portion of his personal compensation into a stock over which he has direct influence. He has put his money where his mouth is, and where his hands can affect the growth of said money.

I imagine there are some 'quick wins' he has in mind in the same vein as those achieved at Air Canada. As a consequence, the stock price can easily rise in double-digit percentages within a couple of years. It's a smart move, a safe bet and as mentioned, not exceedingly bold or unusual.

From the article: "Smith, who has been credited with helping Air Canada expand its international reach to more than 200 destinations..."

It will be very interesting to see how he manages the routes that are in direct competition with Air Canada. I can't imagine Smith signed a non-compete clause or any such restriction, and there are a few Canadian markets that can prove to be lucrative for AF/KLM. How will he approach the CDG-YUL route? Remember, AC's 77W slave ships were so configured as a direct answer to AF on that route (and to better compete on the YVR-HKG route among others). I imagine France/Netherlands to YYZ is an important market that AC also serves, and with AC winding up its first season between YVR & CDG, and Smith having intimate knowledge of the successes/challenges Air Canada faces, how will AF improve its service on that route? KLM is already a very established year-round daily player on its YYZ/YVR routes of course. Will Smith steer his airline into US markets that AC has spent significant effort in establishing an option to Europe for underserved American cities?

Canada comprises a small sliver of AF/KLM's global pie, but Smith likely understands how best to make money by flying to & fro, or at least how to avoid losing money doing the same thing.

Jumper Jack

Plenty of CEOs take $1 salary.. just saying.

5mm

The Lev

Given French tax rates, he won't be taking home many more Euros than that after paying half his salary to acquire shares and most of the rest in taxes... Unless he earns his bonuses.