Tui’s Friedrich Joussen: ‘When teams are under pressure, people will stand together and fight’
When Friedrich “Fritz” Joussen started at Tui in 2012, he was attracted by the challenge of joining a company in the throes of crisis.
Activist investors were pushing to break up the ailing travel group, cost savings were needed to offset an austerity-inspired slowdown in the sector, and the long-mooted merger of Germany-based Tui AG and its UK-based sister tour operator Tui Travel had repeatedly failed to get off the ground.
“If you don’t have a crisis, if you don’t want to change . . . you don’t need leaders,” says Joussen, speaking on the eve of his final board meeting as chief executive from the company’s headquarters in a sleepy business district in the German city of Hannover. “That said, I thought that would have been the biggest crisis in my career.”
Within his first two years at Tui, Joussen had wrapped up the stop-start merger negotiations, creating what remains the world’s biggest tour operator, which employed more than 70,000 staff at its height (now closer to 40,000 people).
But he suspects his greatest legacy will be simply keeping the company afloat when the Covid-19 pandemic struck. “Regulation brought our business to zero,” recalls Joussen. “In my professional career, running a company without revenues is the most difficult spot I’ve been in.”
In the three months to the end of June 2020, Tui reported revenues of just €75mn, down 98 per cent on the year before. For the full financial year, the company booked a €3.2bn loss. It survived only thanks to €400mn in cost savings and nearly €5bn in bailout loans from the German state. Only this year did the company report its “first broadly break-even quarter post-pandemic”.
Joussen has been replaced by Tui’s chief financial officer, Sebastian Ebel, who Joussen first met when running Vodafone’s German division.
Throughout summer, the airline has also been blighted by flight cancellations and delays, costing the company €75mn. Andrew Flintham, Tui’s UK and Ireland managing director, wrote to customers in mid-June to apologise for “the distress caused”. The energy crisis and inflationary pressures across Europe also look set to spark a consumer slowdown later in the year, which will probably rock the travel sector.
But is that challenge enough for Joussen? Not quite. “The market normalises and you have more normal challenges . . . as bad as flight cancellations or whatever are, you say this is more normal,” says Joussen. “And then the question is how up are you for a normal life?”
Joussen’s £6.4mn a year contract was due to run until September 2025 but he exited it early at the end of last month, however the journey back from the pandemic is not over. “Demand is big, but we still have debt and we still have the state as a shareholder, so there will be a couple of years where we need to repair the balance sheet,” he predicts.
And what is his advice for his successor? “Nothing is less important, less wanted than the advice of a former CEO,” says Joussen. “Everybody does it their own way.”
This story originally appeared on: Financial Times - Author:Oliver Barnes
