CHICAGO – Continental Airlines Inc.’s new chief executive, Jeffrey Smisek, said Monday he won’t take a salary or an annual bonus until the Houston airline records a full-year profit.
In a letter to employees, Smisek said that “I am not asking you or anyone else to reduce their pay. What I am asking is that you join me in making Continental profitable again.”
According to a filing Monday with the U.S. Securities and Exchange Commission, Smisek’s annual salary, as of Jan. 1, 2010, is $730,000. The filing said Smisek’s retirement and stock purchase plans “will be impacted by his salary and annual bonus waiver.”
Along with other major U.S. airlines, Continental is expected to report a loss for 2009, as the recession sharply cut passenger traffic last year. Going into 2010, air traffic is slowly recovering, but the price of fuel, the single- biggest expense for airlines, is on the rise.
Executive compensation has been a bone of contention at some other carriers, where rank-and-file employees gave up salary and benefits earlier in the past decade to keep financially weak airlines flying.
Smisek, who has been president of Continental, took over as chairman and CEO following the resignation of Larry Kellner, who left the airline industry at the end of last year.