(Updated Sept. 14, 2021, 8:55 A.M. with details about who initiated departure)
All-cargo airline Amerijet International abruptly announced Monday that former CEO and current Executive Chairman Vic Karjian will replace CEO Tim Strauss on an interim basis, effective Saturday, while it conducts a search for a new CEO only one year after Strauss took the job.
The Miami-based airline, which is owned by New York-based private equity firm ZS Fund, didn’t give a reason for the surprise change, but an industry source with close ties to the company said it was the result of a power struggle.
Karjian seemed unable to step away from day-to-day control and was encroaching on Strauss’ area of responsibility, the source said. As executive chairman, Karjian was supposed to focus on strategic planning, key partnerships and growth objectives.
“It’s not clear if there was something the investment company didn’t like or if Vic was trying to control decisions,” said the individual, who asked not to be named because of ongoing relations with the company. Strauss pushed back against Karjian’s interference, resulting in a heated exchange that led to Strauss immediate departure, the source said.
Another source familiar with the situation said Strauss walked away from the job. He will remain with the company as an advisor through the end of the year. Amerijet spokesperson Christine Richard confirmed that Strauss resigned.
Two weeks ago, he was leading the Amerijet delegation in meetings with key customers at the Cargo Network Services conference in Miami, said another person who attended the event.
The divorce is ironic considering Strauss joined Amerijet for the opportunity to put a bigger stamp on an organization by applying lessons from a long career.
As the head of cargo at a passenger airline “you’re 2% to 4% of the revenue of the company, so you don’t always get to pull the trigger on decisions you’d like to make and push the company where you want to go, even though we were very fast growing. We grew 80% in my time there at Air Canada, but you still don’t quite have your hands on the controls,” he said on the Cargo Masterminds podcast produced by STAT Media Group.
The turnover at the top comes with Chief Operating Officer Brian Beach previously scheduled to leave the company this month, according to the source.
Repeated messages left with Amerijet spokesperson Christine Richards were not returned. Other efforts to reach Amerijet were unsuccessful.
Strauss is a respected air cargo veteran who was vice president of cargo at Air Canada (OTCUS: AC) for several years before succeeding Karjian in August 2020. He previously held executive positions at Delta Cargo (Northwest Airlines before Delta’s takeover), Hawaiian Airlines Cargo and freighter operator Emery Worldwide.
People familiar with Amerijet have been impressed with Strauss’ work so far. He has beefed up the airline’s freighter fleet, won a contract to take over flying five aircraft for DHL Express, helped grow the company’s revenue, implemented new IT projects and was developing plans to expand to more European destinations and possibly into long-haul operations in the Asia-Pacific region.
The airline currently uses about 16 aircraft, up from 10 at the beginning of the year, including 14 Boeing 767 freighters and two Airbus A321 narrowbody plane, according to Airfleets.net and company officials. The A321 is operated for Amerijet under lease by Titan Airways in the U.K. Strauss said the company expects to be at 20 aircraft by the end of 2021, with 25 to 27 aircraft in the fleet by the end of 2022.
Strauss also brought in new talent this year, including several former Delta Air Lines (NYSE: DAL) professionals, and created revenue and project management offices..
Eric Wilson, the new chief commercial officer, previously was managing director of global cargo sales at Delta. Chris Mazzeo, a consultant at the International Air Transport Association who once led Delta’s international cargo operations, was named vice president of global operations in July. Eric Anderson was named director of revenue management and pricing during the summer. He spent 13 years in leadership positions at Delta and most recently worked for Amazon in Tokyo. Last week, the company announced the addition of Ray Bennett as vice president of technical operations. He previously was an executive at Meggitt and spent more than a decade leading maintenance at Delta.
Craig Bently was also recently named as vice president of flight operations.
In the podcast, Strauss characterized his vision of Amerijet as “a start-up within a 44-year-old company.”
Karjian built Amerijet into a large regional carrier that was beginning to become a global air cargo provider, with significant expansion into long-term lease and crew outsourcing operations for airlines and other customers. The airline also provides cargo services to the U.S. Department of Defense as part of the Civil Reserve Air Fleet.
“We are very pleased that Vic has agreed to step in as interim CEO. Having led the company since 2016, he is extremely familiar with the company’s customers and operations and will provide for continuity in the business during this interim period,” said board member and ZS Fund partner Bob Horne in a statement. “The company appreciates Tim’s many contributions over this past year, and we wish him well in his next chapter. The board looks forward to working with Vic to continue Amerijet’s profitable growth while we search for our next CEO.”
Amerijet started in 1974 with one leased aircraft providing small cargo and passenger flights between the U.S. and the Bahamas. Its freighter fleet now serves the U.S., Caribbean, Mexico, and Central and South America. Last year it began operating from its hub at Miami International Airport to Brussels Airport in Belgium after getting qualified by regulators for long-haul routes. Limited Asia-Pacific business is currently handled through partnerships with other carriers.
The company will soon be adding several used Boeing 757 to its fleet, after putting them through a freighter conversion program, to provide additional capacity and route options for its customers.