The controversial boss of British Airways owner International Airlines Group is stepping down after a stormy 15-year career, it was revealed today.
Irish ex-pilot Willie Walsh, 58, will leave the chief executive role and board of IAG on March 26 and retire on June 30, before being succeeded by Iberia chief executive Luis Gallego.
Mr Walsh, chief executive of British Airways between 2005 and 2011, was known for orchestrating the successful creation of International Airlines Group (IAG) through the merger of BA and Spanish carrier Iberia.
The executive has never been far from controversy. Dubbed ‘The Slasher’ for his reign at Aer Lingus which he turned round by axeing 2,500 jobs, he has presided over several BA disasters.
They included an IT shutdown in 2017 that left 75,000 bank holiday passengers stranded, and the bitter dispute with pilots’ pay which brought huge disruption to passengers in September last year.
The dispute saw 3,000 pilots go on strike, causing sweeping cancellations and costing the airline £121million in one of the most damaging periods in the airline’s 100-year history.
The industrial action came a year after hackers stole the personal data of half-a-million BA customers in a breach which led to a £183million fine.
BA was recently ranked near the bottom of long-haul carriers in a Which? airline survey.
International Airlines Group chief executive Willie Walsh (above, in 2015) will retire on June 30
Walsh, from Dublin, started out as a pilot with Aer Lingus in 1979 before he became chief executive in 2001.
He earned the nickname ‘Slasher’ after he cut 2,500 jobs at the Irish airline, but his ruthlessness got him noticed and he took over as CEO at BA.
British Airways was rated one of the worst airlines by thousands of holidaymakers in a poll by Which? last December, marking a dramatic fall from grace for the airline, which in 2015 was voted the best short-haul option in the same survey.
The poll of more than 6,500 travellers saw BA hit third-from-bottom for short-haul travel. It was second-worst for long haul.
In a statement regarding his departure from IAG Mr Walsh said: ‘It has been a privilege to have been instrumental in the creation and development of IAG.
‘I have had the pleasure of working with many exceptional people over the past 15 years at British Airways and at IAG.’
THE TOP AND BOTTOM THREE CARRIERS IN THE WHICH? AIRLINE SURVEY – SHORT AND LONG HAUL
Aurigny – 82%
Jet2 – 79%
SAS Scandinavian Airlines – 74%
Aer Lingus – 71%
Swiss – 71%
Tui – 59%
Whizz – 56%
British Airways – 55%
Vueling Airlines – 54%
Ryanair – 44% (worst overall)
Singapore Airlines – 88% (best overall)
Qatar Airways – 79%
Emirates – 76%
Virgin Atlantic – 72%
KLM – 69%
United Airlines – 62%
Air Canada – 60%
Etihad Airways – 56%
British Airways – 55%
American Airlines – 48%
He added: ‘Luis has been a core member of the team and has shown true leadership over the years and I have no doubt he will be a great CEO of IAG.’
It comes two months after Mr Walsh had said that succession planning was underway as he planned to retire in the next two years.
Speaking at IAG’s annual capital markets day on November 8 last year, Mr Walsh said: ‘I have indicated that I’m clearly getting closer to retirement… the board has been working for some time, as you would expect, on succession planning.’
He said he planned to retire before his 60th birthday on October 25, 2021, adding: ‘I still love what I do, but my intention is to be retired within the next two years.’
Last March, he was handed up to £2.1million worth of shares as part of IAG’s bonus scheme and performance share plan. Mr Walsh was paid £3million in 2018.
IAG chairman Antonio Vazquez said: ‘Under Willie’s leadership IAG has become one of the leading global airline groups. Willie has been the main driver of this unique idea that is IAG.’
He praised Mr Walsh’s ‘strong leadership and clear vision’.
‘I am deeply respectful of what he has achieved as CEO of this group, of his sense of fairness, his transparency and his capacity to integrate people regardless of nationalities or backgrounds,’ added Mr Vazquez.
Mr Gallego also has a long career in the airline industry under his belt, having started with Air Nostrum in 1997 and heading Iberia since 2014.
Mr Vazquez said the Iberia boss had led a ‘profound transformation’ at the airline over his time in charge.
On his upcoming role at IAG, Mr Gallego said: ‘It is a huge honour to lead this great company.
Mr Walsh will be replaced by Luis Gallego (above), currently the boss of Spanish division Iberia
Walsh earned the nickname ‘Slasher’ after he cut 2,500 jobs at the Irish airline, but his ruthlessness got him noticed and he took over as CEO at BA (file photo)
‘It is an exciting time at IAG and I am confident that we can build on the strong foundations created by Willie.’
James Goodall, airlines analyst at Redburn, said Mr Walsh’s retirement was no surprise given the plans he outlined last November, but has ‘come slightly earlier than we expected’.
He added: ‘IAG has good succession planning in place and we see the promotion of Luis Gallego to group chief executive as a good option.
‘Luis has an exceptional track record, turning around Iberia over the past five years.’
Walsh presided over BA between 2005 and 2011, a turbulent time for the airline industry as it dealt with continued fallout from 9/11 and the financial crisis.
The airline cut staff numbers by 6,000 between 2008 and 2010 with Walsh calling striking cabin crew ‘dysfunctional’ and claiming some staff were ‘out of touch with reality’.
Willie Walsh, right, speaking next to Chairman of Iberia airline, Luis Gallego, centre, and Chairman of Vueling airline, Javier Sanchez-Prieto, left, in 2017
During strike talks in 2010, he accused union bosses of portraying him as ‘Hitler and the devil’.
That year, British Airways joined forces with Spanish airline Iberia in a £5 billion merger to create IAG. Walsh saw his salary rise from £735,000 to £825,000 following the merger and in 2015 it was reported that his total pay was almost £5million.
IT DATA BREACH SET TO COST BA BILLIONS
In 2019 British Airways was accused of trying to limit a potential £3billion payout over a data breach that saw cyber-hackers steal more than 500,000 customers’ details.
Some 185,000 customers had their details compromised between April and July 2018, and a further 380,000 were hit by the breach between August and September.
Victims could receive as much as £16,000 each in cases where psychological injury is extreme, while average compensation payments for distress could reach £6,000.
The stolen data included login details, bank card details, and travel booking information – plus names and addresses.
Hackers even managed to get their hands on the three-digit security code on the back of customers’ bank cards.
The cyber attack – known in the industry as ‘pharming’ – remained undetected by BA for several months.
Walsh was reported to have received pay and bonuses of just under £4million in 2017, up 60 per cent from £2.46million in 2016.
From his position at IAG, Walsh was said to hold much of the power for finances at BA – and some blamed him when a computer meltdown hit 75,000 air passengers in 2017.
Walsh had insisted that rather than ‘cost-cutting’ the drastic measures taken under his tenure were more akin to ‘efficiency’.
His replacement, Luis Gallego, is an aeronautical engineer from the Polytechnic University of Madrid who started out in the Training Service of the Air Force.
He worked for Spanish airlines Aviaco, INDRA and, between 1997 and 2006, in several positions in Air Nostrum – where he was technical director of the maintenance workshop until his signing by Clickair as Production Director until the merger of the airline with Vueling.
Gallego was Production Manager at Vueling with responsibility for flight operations, instruction, quality and safety, maintenance and operations.
He was commissioned by Iberia to found Iberia Express in 2012, where he was CEO until his passage to Iberia, first as CEO, on March 27, 2013, and since January 1, 2014 as executive chairman of the company.
Long list of failures: BA’s painful history of IT glitches
British Airways rolled out a ‘cost effective’ IT system in October 2015.
But since its launch, the system has caused a host of problems costing the company more than £100 million.
Workers say it crashes ‘all the time’ and check-in staff are regularly reduced to tears by its glitches.
– The new BA ‘FLY’ system first broke down on June 19 2015, just weeks after first being introduced.
– The system then suffered another failure on July 7, 2016. Two-hour, seven-lane queues formed at all BA check-in gates at Terminal 5 at London Heathrow.
– Less than a week later and the check-in system broke down yet again. On July 13, lengthy queues formed once again at Terminal 5, Heathrow, after the ‘FLY’ system suffered further technical problems
– Five days later it broke down once again and on this occasion TV presenter Phillip Schofield was among those to berate the airline for the delays. The IT glitch also hit Gatwick and caused huge queues as hundreds of thousands of families start going away for their summer holidays. Long queues snaked across terminal buildings as irate passengers said BA workers were nowhere to be seen or ‘pretending to be on the phone’.
– In May 2017 an IT engineer allegedly failed to follow proper procedure at a Heathrow data centre and caused ‘catastrophic physical damage’ to servers leaving 75,000 stranded across the globe. The outage lasted just 15 minutes but it stopped online check-in, grounded planes and broke baggage systems and meant BA was unable to resume a full schedule for four days. More than 670 flights were cancelled, costing the company £80 million.
– There were seven BA system failures in total in 2017. Crashes on June 19, July 7, July 13, July 18 and again on August 2, meant huge delays and cancellations for its customers.
– In 2018 furious passengers blasted BA after airline cancels tickets to the Middle East they bought months ago saying fliers should have realised the £167-return deals were a glitch.
– In July 2019 British Airways was told it will have to pay a record £183million fine for a data breach that saw card details of more than 380,000 customers stolen from its website and app.
– Days later holidaymakers headed overseas for their summer break had to leave their bags behind at Heathrow Airport following problems with luggage handling systems. Passengers including former comedian Eddie Izzard tweeted their frustration and posted pictures of cases piling up in the luggage hall.
– In August 2019 A British Airways‘ IT meltdown caused 12 hours of chaos for 20,000 stranded passengers.
The airline was branded ‘pathetic’ after customers at Heathrow, Gatwick, London City, Manchester, Edinburgh and Newcastle airports were told to ‘go home’ and reschedule after its check-in system collapsed. The IT crash at 4.30am – the third in as many weeks – led to 127 cancellations and another 300 delays.