Willie Walsh, head of Aer Lingus and British Airways parent firm IAG, will step down in June from the airlines group he helped build and hand the reins to Luis Gallego, current CEO of IAG's Iberia.
Walsh said in November that succession planning was under way as he intended to retire as chief executive in the next two years. Gallego has been CEO of Iberia since 2014.
Irishman Walsh, a former pilot, has spent his career in the industry and has been instrumental in establishing IAG.
He became CEO of British Airways in 2005 and oversaw its merger with Iberia in 2011 to form IAG. He has since expanded IAG through acquisitions.
IAG chairman Antonio Vazquez said that Gallego was the right candidate to lead IAG in the next stage of its development, as did Walsh.
"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," Walsh said in a statement on Thursday.
Goodbody analyst Mark Simpson said the appointment would mean little change in IAG's strategy and would be welcomed by investors.
Walsh had "fantastic success at building IAG but obviously promoting internally is seen as a positive. The market regards his successor well," Simpson said.
Walsh made his name standing up to unions and cutting costs first at Ireland's Aer Lingus, where he became CEO in 2001, and then at British Airways, earning him the nickname Slasher Walsh in an industry he once characterized as a "fight for survival."
It was at Aer Lingus where he formed the template for his strategy, benefitting from a front-row seat to the rapid expansion of budget rival Ryanair.
Walsh was much quicker than rival European flag carriers Air France-KLM and Lufthansa to embrace budget flying. IAG bought short-haul carrier Vueling in 2015 and set up long-haul low-cost carrier Level in 2017.
He also bought Aer Lingus in 2015, and IAG is currently in the process of a 1 billion euro deal to buy Spain's Air Europa.
IAG said that Walsh, 58, would step down from his role and the board of IAG on March 26 before retiring on June 30.
Gallego's successor at Iberia will be announced in due course, IAG said. (Reuters)