The imminent departure of Mr Gary McGann could not have come at a worse time for the State-owned airline group. The sudden announcement came as TEAM workers finished voting on the £54 million package to buy out their letters of comfort so that that proposed sale to FLS can proceed. The departure of the top executive comes as the airline tries to make plans for a strategic alliance with another airline, to ensure its future in the international air transport market. In his four years at Aer Lingus, Mr McGann has instilled a commercial focus into the group, reorganised group routes and restructured operations. Financial performance has improved as the Cahill Plan has been implemented. But, as Mr McGann pointed out when the 1996 results were announced, the airline's core operating profits are being squeezed in increasingly competitive markets. At that time, he warned growth in costs had to be tackled and that the airline needed a strong strategic airline partner, which could add financial backing as well as a wider network of routes. That alliance could involve the sale of equity in Aer Lingus. Mr McGann would have been involved in crucial meetings with potential partners and his departure at this time will not help the process.

For Aer Lingus, the most immediate problem will be to find a replacement for Mr McGann as soon as possible. While the date of his departure has not been finalised - sources say he will stay until mid-summer - the process of finding a new chief executive could take some time. With the salary currently set at a maximum of around £100,000 under the Gleeson guidelines - now under review following the Buckley recommendations - a new personal contract is likely to be required to entice a suitable external candidate. Aer Lingus chairman, Mr Bernie Cahill stressed yesterday that Mr McGann has built up a strong management team at the group, indicating the possibility of an internal appointment. Possible internal candidates include: deputy chief executive, Mr Larry Stanley; chief operations officer, Mr Garry Cullen; marketing director, Mr David Bunworth; and finance director, Mr John O`Donovan. Other possible candidates are the heads of the three core air transport divisions - Mr Seamus Kearnet, Mr Jack Foley and Mr Richard Lucente.