Dermot Mannion has resigned from his position as chief executive of Aer Lingus with immediate effect saying his decision was to allow someone else bring new ideas to the business.
Aer Lingus chairman Colm Barrington will act as executive chairman of the airline on a temporary basis while a new chief executive is sought. The airline has started work on seeking a replacement.
Mr Mannion’s resignation follows the announcement recently by Aer Lingus of a €119.7 million pretax loss for 2008. He succeeded Willie Walsh, who left to take the top position at British Airways.
In a statement issued this morning Mr Mannion said: “My decision to step down will allow a new CEO to bring fresh thinking and new ideas to the business.”
Mr Barrington said the “board and management team are focused on maximising revenues, reducing operating costs while maintaining a strong balance sheet to deliver value for all shareholders”.
As chief executive Mr Mannion oversaw the development of long-haul routes to the US and the Middle East and the privatisation of the airline as the Government sold its majority stake.
Aer Lingus was floated on the Iseq index in September 2006.
He also presided over the controversial decision to cut flights from Shannon to Heathrow before the airline partially reinstalled the route after a 14-month absence.
However, Aer Lingus has suffered in the recession the average number of passengers per flight declined.
The airline has cut back services on long-haul and short-haul services, with further schedule reductions expected.
Having resisted two Ryanair bids for the airline, Mr Mannion faced controversy when it emerged former Aer Lingus chairman John Sharman had agreed a change to Mr Mannion’s employment contract.
The change, which was subsequently rescinded, would have yielded Mr Mannion a €2.8 million payout in the event of his departure following a successful bid for the airline.
Siptu said the new chief executive must have a long term strategic view of the national carrier’s development.
“During Mr Mannion’s period as chief executive we negotiated one of the most radical series of partnership agreements in the aviation sector here, or internationally. We expect the new CEO to continue working with us," the union said in a statement.
Fine Gael transport spokesman Fergus O’Dowd TD said Mr Mannion's departure exposed the dearth of Government plans for a sector that "urgently" needed a new strategy.
“Instead of promoting jobs by integrating the airline and tourism sectors, Minister Dempsey’s Government has failed to set out any strategy for growth. We need a Government Green Paper to plan the future survival of the Irish airline and aviation sectors,” Mr O’Dowd said.
"The absence any direction or guidance for the aviation industry is yet another example of the Government’s lack of ideas on job creation and economic recovery.”
The Fine Gael TD said Mr Mannion's decision to make way for someone with new ideas was "commendable," but he added: "I question the wisdom of paying a massive golden handshake when the company lost €120 million last year."