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Jan. 16, 2004, 6:52AM
Gordon Bethune to retire as CEO, chairman of Continental
By BILL HENSEL JR.
Copyright 2004 Houston Chronicle
Gordon Bethune will retire as chairman and chief executive of Continental Airlines at the end of 2004, sources familiar with the situation told the Houston Chronicle Thursday night.
Continental will announce this morning that Bethune will leave the company on Dec. 31 and Larry Kellner, the company president, will become chairman and chief executive on Jan. 1, 2005.
In addition, David Bonderman, Pat Foley, Richard Pogue and William Price will not stand for re-election to the airline's board of directors. That will reduce the size of the board from 14 members to 10.
Continental spokesman David Messing declined to comment on the changes.
Bethune, who will celebrate his 10th anniversary at Continental on Valentine's Day, has been widely heralded as having turned the once-struggling airline around.
Bethune, 62, joined the airline from Boeing Co. after the carrier emerged from its second bankruptcy in a decade. At the time, it ranked last in the industry in most categories.
Within several years, however, the Texas native put in place a system largely focused on customer service that improved Continental's standing in virtually all categories.
Airline analyst Michael Boyd said recently that Bethune found a winning way for operating an airline and he stuck to his guns.
"He has focused on the basics of being an airline," Boyd said. "The airplanes are clean, the airplanes are on time, and you can see it."
Bethune also has been controversial, however. He was widely criticized for receiving a large compensation package last year, even though the airline industry was going through one of its worst periods ever.
And when one of the airlines' unions attacked Bonderman last year, Bethune issued a statement defending the longtime board member.
Employee-shareholder members of the International Brotherhood of Teamsters called for Bonderman's resignation, alleging Bonderman has a conflict of interest caused by financial investment, interest and control in Continental competitors.
They also cited concern about a recent stock sale involving Bonderman, who has been on the board of directors for about a decade.
Bethune said last month that one of his fervent beliefs is that, first and foremost, being honest with employees.
"You have got to tell everybody the truth," he said. "You get a lot more respect."
He has also maintained that he has surrounded himself with the best employees he can find and let them run things.
Bethune said he recruited Kellner to the airline in 1995 as senior vice president and its chief financial officer because he believed he was the best CFO in the country. The additional title of executive vice president was added a year later.
Kellner, 44, was named president and elected to the board in May 2001 and given the additional responsibilities of chief operating officer in March 2003.
Jay Panarello, master executive chairman for Continental pilots, said he thinks Bethune has an opportunity to leave a legacy of good labor relations, if a new contract can be hammered out with the pilots by the end of the year.
After being on hiatus recently, talks between management and labor are getting under way this month.
Gordon Bethune to retire as CEO, chairman of Continental
By BILL HENSEL JR.
Copyright 2004 Houston Chronicle
Gordon Bethune will retire as chairman and chief executive of Continental Airlines at the end of 2004, sources familiar with the situation told the Houston Chronicle Thursday night.
Continental will announce this morning that Bethune will leave the company on Dec. 31 and Larry Kellner, the company president, will become chairman and chief executive on Jan. 1, 2005.
In addition, David Bonderman, Pat Foley, Richard Pogue and William Price will not stand for re-election to the airline's board of directors. That will reduce the size of the board from 14 members to 10.
Continental spokesman David Messing declined to comment on the changes.
Bethune, who will celebrate his 10th anniversary at Continental on Valentine's Day, has been widely heralded as having turned the once-struggling airline around.
Bethune, 62, joined the airline from Boeing Co. after the carrier emerged from its second bankruptcy in a decade. At the time, it ranked last in the industry in most categories.
Within several years, however, the Texas native put in place a system largely focused on customer service that improved Continental's standing in virtually all categories.
Airline analyst Michael Boyd said recently that Bethune found a winning way for operating an airline and he stuck to his guns.
"He has focused on the basics of being an airline," Boyd said. "The airplanes are clean, the airplanes are on time, and you can see it."
Bethune also has been controversial, however. He was widely criticized for receiving a large compensation package last year, even though the airline industry was going through one of its worst periods ever.
And when one of the airlines' unions attacked Bonderman last year, Bethune issued a statement defending the longtime board member.
Employee-shareholder members of the International Brotherhood of Teamsters called for Bonderman's resignation, alleging Bonderman has a conflict of interest caused by financial investment, interest and control in Continental competitors.
They also cited concern about a recent stock sale involving Bonderman, who has been on the board of directors for about a decade.
Bethune said last month that one of his fervent beliefs is that, first and foremost, being honest with employees.
"You have got to tell everybody the truth," he said. "You get a lot more respect."
He has also maintained that he has surrounded himself with the best employees he can find and let them run things.
Bethune said he recruited Kellner to the airline in 1995 as senior vice president and its chief financial officer because he believed he was the best CFO in the country. The additional title of executive vice president was added a year later.
Kellner, 44, was named president and elected to the board in May 2001 and given the additional responsibilities of chief operating officer in March 2003.
Jay Panarello, master executive chairman for Continental pilots, said he thinks Bethune has an opportunity to leave a legacy of good labor relations, if a new contract can be hammered out with the pilots by the end of the year.
After being on hiatus recently, talks between management and labor are getting under way this month.
