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Aer Lingus chairman: US operation under scrutiny in review

Aer Lingus is undergoing a review of its business as the airline looks to reverse last year's losses and improve on its poor outlook for 2009.

Citing a fall-off in leisure travel from Ireland to the USA - partly caused by strengthening of the dollar - Aer Lingus chairman Colm Barrington told ATI in Dublin that the carrier was taking "a very critical look at all its US operations".

He admits: "The likelihood is that we will not be operating as many routes or as many frequencies as we currently operate."

Changes to working practices at the airline are also in prospect. "Aer Lingus was, for 70 years, a state-owned company, and practices built up during that period...some of them have changed but not all of them," he says.

"If Aer Lingus is to survive as an independent airline...we have to make the airline efficient in the modern marketplace. The extra concern for Aer Lingus is that if it doesn't make itself successful, and therefore retain its independence, it will get acquired."

While Irish budget rival Ryanair has stated that it would not make a third attempt to acquire Aer Lingus, Barrington is sceptical. "Ryanair has made two bids already, I presume they'll make another one," he says.

"If [Aer Lingus] can't make the company successful and produce shareholder value and keep the share price up, then they're vulnerable. At 70p per share we're vulnerable, so we've all go to realise that and do something about it."

Required changes, says Barrington, cannot await the appointment of a new chief executive, following the abrupt departure of Dermot Mannion.

"We've got to do things in the interim. Aer Lingus has to be made as efficient as its competitors," he says. "If you can't get your cost and your efficiency and your whole way of doing business to that level, you're going to have your lunch eaten. It's just a fact of life. You can't defy gravity."

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