Julian Moxon/PARIS

SAirGroup's plans to merge three French airlines to create a major competitor to Air France appear to be in tatters following the resignation of the president of SAirGroup France, Paul Reutlinger.

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Though he officially resigned for "personal reasons", Reutlinger was closely identified with the strategy of former SAir president Philippe Brugisser (deposed late last month), which is expected to be jettisoned by his successor, Erich Honegger.

Reutlinger - chief executive of Sabena between 1996 and 2000 - had been working with McKinsey Consulting to define a strategy for the new airline to be formed from Air Liberté, AOM and Air Littoral, and had planned a commercial relaunch in the next three months. SAir director general Hans-Ruedi Fehr, responsible for combining the three as a single entity, had revealed plans to replace their entire medium-haul fleet with Airbus A320 family aircraft by 2003, and to order up to 20 regional jets this year.

SAir had planned to establish a French major to challenge Air France, which has built up regional strength by moving to take control of Britair, Proteus Airlines and Regional Airlines, and though SAir's plans are officially on hold pending the appointment of a new chairman, they are inevitably under threat.

Unions at the French airlines have attacked the sudden change in direction, with a source revealing a new name and strategy had originally been due to be revealed on 1 February.

SAir has already scrapped plans to buy 34% of TAP-Air Portugal and will not participate in the privatisation of Turkish Airlines, although it does intend to continue its strategy of investment in Poland's LOT (in which it has a 37.6% stake) and South African Airways, where it has an option to increase a 20% holding to 30% by the year-end.

Source: Flight International