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Airbus names outsider to lead defence and space business

Airbus has named Siemens executive Dirk Hoke to succeed Bernhard Gerwert as chief executive of Airbus Defence and Space next year, reaching outside the company to succeed a 36-year veteran of the company.

Hoke will join Airbus Group on 1 January and serve as Gerwert’s deputy for three months, then become CEO starting on 1 April. Gerwert will remain in a consulting role through at least June before retiring, fulfilling a succession plan he began discussing with Airbus Group chief executive Tom Enders in 2013.

Hoke has a “very remarkable track record of building and growing businesses throughout four continents,” Enders says.

In a 19-year stint at Siemens, Hoke rose quickly through the executive ranks. Within 10 years, he was named president of Siemens Transportation Systems Group in China, which was then developing a high-speed magnetic levitation train in Shanghai.

He continued as chief executive of other Siemens regions, such as Africa, and also led the customer services division in Erlangen, Germany. Most recently, Hoke was the head of Siemens’ large drives division, making electrical voltage equipment for industrial customers.

As such, he becomes a rare example of a CEO-level executive joining Airbus from outside the company, and, indeed, from outside the industry.

Enders characterised that record as a strength for Hoke, whom he says is “well equipped for a world and business environment that is ever more accelerating in various dimensions”.

But the Airbus division that Hoke inherits is struggling to accelerate revenues amidst declining defence spending in key markets and serial delays and production problems raising costs on the A400M transport programme.

The Airbus Defence and Space division posted flat revenues of $14.7 billion (€13 billion). It faces a serious challenge to recover the A400M programme after a flight test crash earlier this year. Meanwhile, the space business is looking to capture more Ariane 6 orders, as a new Airbus Safran Launchers joint venture attempts to meet the commercial challenge posed by SpaceX.

As Hoke takes over the company, he will also deal with a familiar challenge for Airbus executives charged with driving new innovation in the defence and space segment.

In 2014, Gerwert addressed the challenge in a presentation to the European Defense Agency. “We do not need special incentives [to innovate], we just need programmes,” Gerwert says. “Research and development is only worthwhile if we have the ambition to build the next generation of products. If we don’t have that ambition then it makes no sense to spend the money.”

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