Delta CFO Paul Jacobson will finally be departing the airline. After first announcing his retirement earlier this year and then sticking on through the crisis, from November 15th, Mr. Jacobson will be departing Delta Air Lines to join the car industry as he becomes the Chief Financial Officer (CFO) of General Motors.
Paul Jacobson over the last few months
Mr. Jacobson deferred his retirement as the crisis progressed as Delta needed a strong figure to help shore up the airline’s cash position and navigate through the crisis. Now, over six months into the crisis, Mr. Jacobson and his team have worked to raise nearly $30 billion in liquidity for the carrier.
Operationally, Mr. Jacobson and his team worked to reduce costs and reduce the carrier’s daily cash burn. Delta has had a goal of maintaining an investment-grade balance sheet. While the recent crisis has not helped the airline much with that, it hopes that the current team Mr. Jacobson is leaving behind will help keep Delta strong in the future.
Who will replace Mr. Jacobson?
Delta has not named an immediate replacement. The carrier will be weighing its options and conducting a global search. Delta will be looking at candidates who are already part of the Delta team and those outside the Delta system.
In the meantime, Gary Chase, Senior Vice President of Business Development and Financial Planning, and Bill Carroll, Senior Vice President of Finance and Controller, will serve as co-Chief Financial Officers. The two of them will, together, lead the Finance team at Delta.
Any CFO who comes after Mr. Jacobson will have big shoes to fill. Since joining the airline in 1997 and becoming CFO in 2021, Mr. Jacobson has done a lot of work to shore up Delta’s position. He has been a key contributor to strategies and spearheaded projects like the acquisition of the oil refinery, nearly $10 billion in debt reductions, New York-JFK’s terminal four expansion, and managing capital allocation.
Why his retirement was delayed
At the end of February, Mr. Jacobson announced his retirement from Delta. He had planned to stick around until a replacement was named. At the time of this initial announcement, Delta was in a strong financial position and was looking forward to 2020 being another record-breaking year for the airline. Unfortunately, that did not materialize.
In April, as the crisis dragged on, and it became clear that Delta would need stable leadership, Mr. Jacobson decided to rescind his retirement from Delta to manage the ongoing crisis. Some early actions taken were to shore up liquidity and starting from April, the airline trained its attention on reducing its cash burn and capital expenditures.
Now, with Delta being in a strong liquidity position and ready to tackle the future with some signs of a rebounding domestic market, Mr. Jacobson likely thinks it is a good time for him to head out. He has, most certainly, kept Delta in a strong position for his successor to take over and continue to manage the airline’s financial position.
Mr. Jacobson’s retirement comes as other top executives retire or leave the airline. This includes Air Canada’s CEO, Calin Rovinescu, and shuffles at International Airlines Group (IAG), the parent company of British Airways.
Are you sad to see Mr. Jacobson leave Delta Air Lines? Let us know in the comments!