BUSINESSWEEK ONLINE : NOVEMBER 20, 2000 ISSUE
INTERNATIONAL -- SPECIAL REPORT

Got a Busted Airline? He's the Man to Fix It (int'l edition)


Like many people, Paul Reutlinger has a Saturday morning ritual. He goes to a neighborhood cafe, where he's greeted as a regular, orders coffee, and reads the local paper. The routine doesn't vary--only the country. Moving from his native Switzerland to Belgium and now to France, Reutlinger is a traveling Mr. Fix-It for ailing airlines.

In an industry where national pride and politics still hold sway, Reutlinger is a professional outsider. A Swissair marketing executive who has lived all over Europe and in Latin America, he was recruited in 1996 to head Belgium's Sabena after Swissair's parent, SAirGroup, took a 49% stake in the former state-run Belgian carrier. Within two years, he engineered a turnaround that put Sabena in the black for the first time in 40 years. Now Reutlinger has come to France as CEO of Air Liberte, Air Littoral, and AOM, three carriers in the midst of a difficult merger.

Reutlinger, 57, combines a hard-nosed management style with the skill of a diplomat. Arriving at Sabena, he immersed himself in local culture, making friends with politicians and journalists over leisurely lunches and hanging art by the Belgian surrealist Rene Magritte in his office. But he also slashed costs and, by taking a more conciliatory tone, extracted concessions from labor unions. ''I had an advantage because I didn't have a history in Sabena and was seen as more or less a neutral person,'' he says.

His task in France looks even more difficult. He enjoys strong backing from SAirGroup, which holds minority stakes in the three regional carriers and wants to merge them to strengthen its hand against Air France. But all three companies are losing money and have been plagued by worker strikes in opposition to the merger. Reutlinger also has the delicate task of cohabiting with Alexandre Couvelaire, the French former chairman of AOM and Air Liberte, who could chafe at relinquishing management control. But Reutlinger is confident he can pull the group out of the red by 2003, by negotiating new labor deals and taking advantage of operating efficiencies from the merger.

His multinational background should help. He's fluent in five languages: English, German, French, Dutch, and Spanish. And, Reutlinger says, ''Wherever I am, I take the time to understand the culture, to really live and see the habits of the people.'' Call it Cafe 101: Order the coffee, learn the culture.

By Carol Matlack in Paris

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