American Airlines shuffles top staff after key customer service executive steps down

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Kevin Lamarque | Reuters

American Airlines is shuffling some of its top executives after a key departure and struggles with its operations that led to hundreds of flight cancellations and long delays over the past few months.

Kerry Philipovitch, senior vice president of customer experience, handling areas from reservations, customer service, baggage and premium service, will retire at the end of the year, the airline said Thursday. A spokesman called the departure of Philipovitch, 49, who has been in the role at American since 2013, “entirely voluntary.”

The changes come amid growing pressure on American’s CEO, Doug Parker, to improve the Fort Worth, Texas-based carrier’s operations after it faced hundreds of cancellations over the summer, angering customers and employees. American’s stock is down more than 15% so far this year while Delta and United are each up 4%.

American has blamed many of the delays and cancellations on the unions representing its mechanics, which it accused of conducting an illegal work slowdown to gain leverage in contract talks, accusations the unions have denied. Negotiations resumed last month.

“The most important thing we can do to make culture a competitive advantage and deliver a world-class customer experience is run a safe and reliable operation. We haven’t been consistently hitting the mark, and that’s not fair to our team or our customers,” American’s president, Robert Isom, said in a note to employees.

The airline has made recent improvements, however. In September, nearly 83% of American’s flights arrived on time, its best month since November 2017 and more than 4 percentage points higher than the year-earlier period.

“The changes we’re announcing today will help build on that momentum and ensure we’re operating better than ever by increasing coordination across all operations functions,” Isom said.

The changes will mean Isom will have four direct reports, down from five, since American won’t replace Philipovitch.

David Seymour, for example, will expand his role as head of operations to take on Philipovitch’s tasks of managing airport operations.

Head of network planning, Vasu Raja, who was promoted to senior vice president, will add airline alliances and partnerships to his role. Joint ventures and equity stakes have become more important to airlines as they expand because foreign ownership rules prevent carriers from buying foreign airlines outright. Last month, rival Delta announced a surprise minority stake in American’s longtime Latin American partner LATAM, the region’s largest airline.

Kurt Stache, senior vice president of loyalty and marketing, will take on passenger experience management, which Philiopovich previously handled.

The changes will mean Isom will have four direct reports, down from five.

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