Q&A / BOB FORNARO, president and CEO, AirTran Airways

As the fifth of seven children growing up in a blue-collar family in suburban New York, Bob Fornaro quickly learned the art of survival.

"You had to move very quickly," said Fornaro.

That could almost be the corporate slogan of AirTran Airways, where Fornaro, 53, was named chief executive this month, replacing longtime CEO Joe Leonard, who remains chairman.

Under the two executives' leadership over the past eight years, Orlando-based AirTran has grown into one of the nation's largest discount carriers partly by swooping into markets and buying airport gates, flying rights, jets and other assets as competitors were faltering. AirTran is now Delta Air Lines' largest rival in Atlanta, with most of its roughly 9,000 employees local.

In some ways, Fornaro's rise to the top job mirrors AirTran's moves.

Like a lot of working-class kids growing up in the 1950s, the son of a school maintenance man and homemaker says his family didn't have much money but he lived a happy existence riding his bicycle, playing games, and scrapping with his siblings and neighborhood buddies.

"We weren't angels," he said. "[But] I knew one thing. My folks wanted me to do well and to do better than my family."

He made good grades, and he brokered them and a knack for lacrosse into a scholarship at Rutgers University. After that, Fornaro headed for Harvard, pulling together enough money from jobs, loans and financial aid to get a master's degree.

"I just kept moving forward. I didn't have a plan," said Fornaro.

In these times of stratospheric fuel costs tied to record crude oil prices near $100 a barrel, Fornaro believes AirTran will need to follow a similar ready-for-anything strategy to thrive.

"We are a very nimble company," said Fornaro, who talked to The Atlanta Journal-Constitution this week about his career and the state of the airline industry. "I think if there is a downturn, we will step through it faster than our competitors."

Q: How did you first meet Joe Leonard?

A: It was probably early 1991. I think he joined Northwest [Airlines] in late 1990. He was the head of customer service ... and I was running planning and alliances. ... Richard [Anderson, the current CEO of Delta,] was there as well.

Q: Did you ever expect that you and Anderson would be heading rival airlines?

A: No, I did not.

Q: So eight years later, Joe Leonard calls you up to join him at AirTran [which was struggling to recover from a notorious crash involving its predecessor, ValuJet]. How did those early days go?

A: When Joe called I spent my first month and a half as a consultant before I hired on. But the fact is there wasn't enough time to consult on anything. You had to come out and start doing. (Fornaro snaps his fingers.) Right away we dug in because we had real revenue problems. There were a lot of things to fix and not enough time.

Q: Now that there's a change in leadership at AirTran, does Atlanta have any better odds of getting AirTran to move its headquarters here?

A: No.

Q: I hear you guys are talking to Orlando about getting incentives to build an operations center. Would that include a new headquarters there?

A: Our current [headquarters] facility houses our operations center. ... We're overcrowded and, No. 2, we need a more secure, sturdy building, more of a bunker-type building that can withstand storms and everything else.

Q: If Orlando flubs their deal, wouldn't you rather have Atlanta lure you up here where there aren't hurricanes?

A: We told Florida we'd give them the first shot. All it boils down to is we've got a good thing going [with the Florida-based headquarters] and we don't want to mess with that formula right now.

Q: The big news last week was a hedge fund's ongoing efforts to get Delta and United Airlines to merge. Would that be good news for AirTran?

A: It could be. ... I think on the one hand it would put us against an even larger competitor. We're dealing with carriers that are giants compared to us already. But I still have the belief that if we keep managing AirTran the way we have ... we can control our own destiny.

Consolidation in theory could create some opportunities because there's no way you could combine Delta and United without shedding some number of assets. It could be additional [airport] gates in Atlanta or at O'Hare [in Chicago] or slots at LaGuardia [in New York]. We would try to act opportunistically [to buy those].

Q: A big merger like that would take years to complete. How would that help when airlines are dealing with nearly $100-a-barrel oil today?

A: I don't want to make the case for the hedge fund. ... If you look at the economics separately, it could be compelling under the right scenario. The problem is the integration process could be very, very difficult. Certainly we're seeing an interesting example with the US Airways-America West [merger, ongoing since 2005]. Obviously there's issues there.

Q: AirTran tried earlier this year to acquire Midwest Airlines, without success. How much did hedge funds support that deal?

A: It's all about money. They were very supportive. ... They wanted a closed deal, and they wanted us to bid the price up.

Q: Hundred-dollar-per-barrel oil seems close to inevitable. What will airlines look like a year from now if oil prices stay at that level?

A: I think it's a very, very big hurdle. I think the scenario is fairly simple. You'll see higher [ticket] prices to offset it. You'll see a doubling of any conservation measure you can [do]. ... And I think there will be lower capacity in the domestic marketplace.

As prices rise, it will have an impact on the number of travelers, and some carriers will go negative on capacity, and others will reduce their growth rate. ... We've taken our own steps in this environment to bring our supply [in line]. If we have to do more, we'll do more.

Q: If oil and fuel costs stay that high, will AirTran be smaller a year from now? Will it be profitable?

A: You don't know what happens because you don't know the impacts on the economy. I think we'll be better prepared to manage it. I think what will happen is carriers will react and pull capacity down. For us, that could create opportunity.

MEET BOB FORNARO

* Title: President and chief executive, AirTran Airways

* Age: 53

* Family: Lives in Orlando with wife, Karen. Has three adult children.

* Background: Grew up in Plainview, N.Y., on Long Island. Went to Rutgers University on a lacrosse scholarship; graduated with a bachelor's in economics. Has a master's in city planning from Harvard University.

* Career: Joined the Orlando-based discount carrier in 1999 as president, helping then-CEO Joe Leonard rebuild the airline after the 1996 crash of a plane belonging to its predecessor, ValuJet. Prior to that, Fornaro ran a consulting business and was a senior vice president at US Airways, Northwest Airlines and Braniff.


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