November 26, 2017 / 12:28 PM / 19 days ago

Exclusive: Airbus set to poach Rolls exec to head jetliner sales - sources

PARIS (Reuters) - Airbus (AIR.PA) is poised to hire the head of Rolls-Royce’s civil engines unit, Eric Schulz, to lead its commercial jetliner sales, after months of uncertainty over the successor to sales kingpin John Leahy, three people familiar with the matter said.

Schulz, president of the civil engines division at the British engineering firm, has been recommended for the post to bring in outside blood as the company faces turmoil over the impact of UK and French corruption investigations.

Christian Scherer, chief executive of turboprop maker ATR, jointly owned by Airbus and Italian aerospace firm Leonardo (LDOF.MI), had also been considered for one of aviation’s highest profile roles.

Scherer, an Airbus veteran of 30 years before joining ATR, was seen by many as a leading candidate and enjoys close ties to Chief Executive Tom Enders. But although Scherer has not been linked to the compliance investigations, industry sources said the board is insisting on a break with the past.

A final decision will be taken by the Airbus board based on a panel’s decision to put forward one name, that of Schulz.

Airbus and Rolls-Royce declined to comment. Schulz and Scherer could not immediately be reached for comment.

Leahy has been in the post since 1994 and is a dominant figure in the $100 billion-a-year aerospace industry, making his succession one of the sector’s most closely watched moves.

He is expected to retire around Jan. 25 after deferring his departure for several months when his hand-picked successor, deputy sales chief Kiran Rao, pulled out of the race.

CLOSE TIES

Schulz, an affable 54-year-old French engineer, began his career at one of Airbus’s founders, France’s former state-owned Aerospatiale, before working at aerospace supplier Goodrich via a stint at two French airlines: UTA and Air Liberte.

He is part of a relatively new management team that pulled Rolls-Royce out of its own compliance scandal and financial problems and has been running civil engines since January 2016.

His experience reinforces close ties between Airbus and Rolls-Royce on wide-body jets, mirroring last year’s decision by rival Boeing to recruit a top executive from its own top supplier, General Electric (GE.N), to run its commercial unit.

“Rolls-Royce and Airbus are joined at the hip so they must know him well, and he them,” said Agency Partners analyst Nick Cunningham, adding Schulz came across as “open and realistic”.

But he will inherit a Toulouse sales organization unsettled by recent defeats against Boeing and widely seen as desperate for stability amid the probes, which center on a now defunct Paris-based unit of Airbus headquarters.

    “They have chosen a clean break but that is not without risk,” a senior industry source said.

    If, as expected, he is confirmed by the Airbus board, Schulz will need to act quickly to restore staff morale and rebuild bridges with customers following a wobbly Dubai Airshow this month, industry sources said.

    But although he has twice worked for firms linked to Airbus, Schulz’s independent career path may give him a freer hand to shape a marketing machine urgently needing a fresh spark after prolonged uncertainty over Leahy’s succession.

    “He is very straight; not political,” said a person who has negotiated with Schulz.

    Analysts say investors are for now playing down the probes and loss of order momentum because Airbus, like Boeing, is cushioned by record backlogs of jets waiting to be produced.

    But the choice of sales boss is a decision that many say will influence the direction of the aerospace giant for years.

    Airbus shares have risen 18.5 percent in the past six months, outperforming an almost-flat French CAC40 .FCHI index.

    Reporting by Tim Hepher; Editing by Elaine Hardcastle and Keith Weir

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