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Bain hails ‘hands-on CEO’ Hrdlicka after Scurrah’s Virgin exit

written by Adam Thorn | October 15, 2020
Jayne Hrdlicka 2
Jayne Hrdlicka speaking at her previous role with The Qantas Group (Jetstar, WIki Commons)

New Virgin owner Bain has said it appointed incoming chief executive Jayne Hrdlicka because she would provide a “different form of leadership to survive”.

“We need a hands-on CEO with deep aviation, commercial, operational and transformation experience,” said Bain Capital managing director Mike Murphy in a statement. “She has extensive airline experience and I know she, alongside Bain Capital, wants nothing more than to see Virgin Australia prosper and thrive well into the future.”

Bain’s vocal support for Hrdlicka came hours after administrator Deloitte announced that current chief executive Paul Scurrah apparently resigned on Thursday.

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His departure is significant because he is synonymous with the airline’s plan to operate as a mid-market ‘hybrid’ rather than reverting back to being a low-cost carrier like predecessor Virgin Blue.

Hrdlicka also had a notoriously fraught relationship with unions in her earlier role at the Qantas Group, where she headed low-cost carrier Jetstar.

However, both Hrdlicka and Bain were quick to emphasis the appointment would not result in a new strategy.

“I appreciate Virgin Australia’s unique culture and I want to protect and build on it,” she said. “And I am determined that Virgin Australia reinvigorates its strong brand and its passion for customer service, while embracing the diversity, talent and strength of its people.”

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Murphy added that while this year had been the “toughest in global aviation history”, the business was “committed to the strategy Virgin Australia announced in August, when the company outlined its plans to protect thousands of jobs, invest in technology and honour all employee entitlements”.

In a statement to Australian Aviation, Bain played down Hrdlicka’s bad relationship with unions and instead said she “played a key leadership role in the dramatic improvement in Qantas’ customer experience, working hand in hand with the front-line teams to make this possible”.

“During her time as the CEO of the Jetstar Group, Jetstar became one of the world’s leading airlines and delivered a series of record profits,” it added. “While achieving strong profits, it also recorded the highest staff engagement scores in the airline’s history. During that time Ms Hrdlicka also appointed Australia’s first female chief pilot.”

The handover will take place in early November, when the formalities of Virgin’s sale to Bain are completed.

The news comes despite Scurrah exclusively telling the Australian Aviation Podcast just weeks ago that Bain was “a really good owner” and that the relationship between the investors and the existing management team was like “a good marriage”.

At the end of the show, Scurrah signalled he was keen to appear on the show again to talk through how his plans were developing, suggesting his decision to apparently resign is a recent one.

The announcement of Hrdlicka as the new boss is likely to infuriate the TWU, which had a high-profile falling out with the airline when rumours of her appointment swilled months ago.

Just yesterday, the TWU suspended negotiations with the business over new working terms for its members until it received clarification that Scurrah would not be fired. However, relations were unravelling before that and the union only backed Bain’s acquisition at the last minute.

14 Comments

  • Themikeair

    says:

    Can’t wait to hear your opinion regarding this on podcast

  • Teiemka

    says:

    AA continues to use this as a calling card for Hrdlicka in the last couple of months “Hrdlicka also had a notoriously fraught relationship with unions in her earlier role at the Qantas Group, where she headed low-cost carrier Jetstar.”

    I don’t doubt it considering the huff the TWU is in about her appointment, but it would useful for readers if some context was added on issues which contributed to this “fraughtness”

    • Adam Thorn

      says:

      We will get to that! The reason we keep referring to it is because it’s the crucial context in this story: union backing was vital to getting this deal across the line, but the TWU, in particular, despises her. For this to happen after the sale will be seen as Bain doing a fast one. Did they really though? We don’t know. And we don’t know what happened behind the scenes. Still, it will be interesting to see how this plays out in the next few weeks.

      Thanks,

      Adam

  • Iain

    says:

    This was Bain’s plan all along!! Get the business and then get rid of Paul, he was liked by everyone. Bain wants someone in there that doesn’t care about employees, you watch all above and below wing will be contract within 6 months.
    The whole sale process was dodgy right from the start.

  • Mark

    says:

    What is important is how many 737s VA owns as Bain loves to asset strip , it is the key to their success.

  • Steve A

    says:

    Anyone who didn’t see this coming has been asleep.
    I warned about it in my comments previously, as did others.
    Bain won’t own VA for long as their modus operandi is one of saddling the business up with debt that was used to buy the business in the first place, then make it look good, then dump it. Suck it dry, and many of their previous companies have failed after they have bled them dry.
    I cannot believe that there are people out there who believe that this will end well.

  • Craigy

    says:

    Maybe Bain can smell a change of government in the air and so Scurrah’s closeness to labor will be of no use in the future.

    On another note, the first A321 freighter for Qantas has arrived in Melbourne.

  • Peter

    says:

    She did nothing for Jetstar, she got the boot from A2 Milk & now she is running Virgin ?? Good Luck.

  • Linda Weaving

    says:

    Did the ‘fraught relations’ have anything to do with contracting out staff, poor pay, poor conditions and staff forced to sleep at the airport due to unreasonable shifts? Can’t remember exactly which airline did what.

  • Jamie

    says:

    Bain’s plan is starting to show.
    IF, & that’s still a big if, they take control, there’ll be possibly another approx 1500 staff sacked, they’ll get rid of any unwanted planes ASAP, then full steam ahead on a probable LCC, with a few seats’ up front for those with too much money.
    It’ll be very interesting if the airline will be still flying come 2023. I’ve my doubts, as Bain’s business model is very different to anything seen in this country before.

  • Paul

    says:

    The phone calls that allegedly occurred between Joyce and herself during her appointment make for interesting thoughts. Is Qantas going to be the buyer of a future cheap Virgin as it’s stripped bare and become the monopoly it so craves? The whole sordid affair has a whiff of something very smelly.

  • Cactus

    says:

    Bottom line here is that Bain lied to get their deal across the line. Bain are entitled to have whoever they want as CEO, but to get a result [for which employees are voting creditors] over bidding rivals by representing a certain management would be in place [and then to do the opposite] is downright dishonest and an abuse of process.They should have had the honesty to have said that they wanted Hrdlicka as CEO and argued the case why.
    They didn’t – and will never be trusted again and have set back the cause of VC Funds generally in being trusted.

  • High Flyer

    says:

    Well done Scott Morrison for your lacking support of the aviation business in Australia.
    Thousands of people without a job as another Australian icon has fallen in “foreign” hands.
    Very smelly case indeed.

  • DRSmith

    says:

    @MARK: Virgin no longer owns any 737s outright.

    Etihad, Singapore Airlines had already “asset-stripped” the 737s and 777s by putting bank loans against them.

    Bain can’t really “asset-strip” what is left Virgin when the former owners had already “asset-stripped” most of VA during their tenure as owners.

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