The “New” Alitalia Launches In June 2020

Filed Under: Alitalia

While all airlines are struggling at this point, the airlines that were most financially vulnerable going into this are also the ones in the worst positions now. Just look at South African Airways and Virgin Australia, for example.

Well, at least that’s true for the most part. And then you have Alitalia.

Alitalia is being renationalized

As I wrote about in mid-March, the Italian government is taking full control of Alitalia. The government will be investing a further €600 million in the airline.

Alitalia will officially be renationalized, rather than just being kept on life support, as has been the case for the past several years (since Etihad pulled the plug on Alitalia). The airline had been privately owned for 11 years, with three separate failed restructuring attempts.

Etihad pulled the plug on Alitalia in 2017

New Alitalia to be formed in June 2020

Italy’s Industry Minister, Stefano Patuanelli, yesterday outlined what we should expect from the “new” Alitalia:

  • The government will create a new company at the beginning of June that will take over 100% of the airline
  • The new airline will start with a fleet of more than 90 aircraft, compared to the current 113 aircraft; previous reports suggested the new airline could have just 30 planes, but that’s not the case
  • The new airline will work with unions to make sure as many people stay employed as possible
  • It’s undecided as of now whether the airline will remain under government control long term, or only until they get to the point where they can find a buyer
  • Alitalia is considering leaving SkyTeam for another alliance (especially now that they’ve been kicked out of the transatlantic joint venture), though we’ll see if that actually happens

Alitalia will be renationalized

Is anything actually changing at Alitalia?

As Italy’s Industry Minister describes the changes at Alitalia:

“Until now Alitalia has been a crystal vase among steel vases. The new company will kick off in the same position as other airlines once the sector restarts.”

Is anything actually changing, though? I guess we’ll see in June what the “new” Alitalia looks like, though it sounds to me like they’ll have the same employees, same business plan, and most of the same planes. The only difference is that they’ll have a marginally smaller fleet, as so many airlines will have after COVID-19.

It sure doesn’t sound to me like a whole lot is changing at Alitalia…

Bottom line

The “new” Alitalia will be launching in June 2020, with a slightly smaller fleet, but otherwise it sounds a whole lot to me like the old Alitalia. I guess that’s not a problem as long as the government is willing to foot the bill, but personally I remain highly skeptical about Alitalia actually becoming a viable business.

Comments
  1. Alitalia last turned a profit in 1997. The “new” AZ will be the same as the old. Nothing will change.

  2. Uhh do we have any idea what he’s trying to say with that metaphor? It’s more fragile? It’s nicer than it needs to be?

  3. Something is changing: The airline will become even more inefficient than before:
    Fleet reduction + keeping all the employees = massive overstaffing, even more so than before.

  4. “The new airline will work with unions” means it will bankrupt again within 10 years, or maybe just 5 years, or less.

  5. What will happen to all the miles? If I have miles with Alitalia FF program – what happens to them?

  6. This is all part of the populist M5S party’s strategy (with the complicit silence of their center-left partners) to turn Italy into the Venezuela of Europe.
    We’ll have to add the umpteenth public bailout money to the billions of debt we’re already stacking up because of Covid-19.

  7. ::EYEROLL::

    This guy must have a crazy definition of the word “work” then. It’s been shown time and time again that NO ONE, especially the government can “work” with Alitalia’s Unions.

    I mean, really, c’mon now, really.

  8. Alitalia will never change. It doesn’t need to. It has the strongest financial backing of any airline in the world. They have an entire government that just throws money at them year after year with no strings attached! How great is that?! Nothing will kill Alitalia so expect Alitalia to be around for a long time.

  9. Typical. Calling Germany antisocial for refusing eurobonds but at the same time investing €600 million in an airline that hasn’t been profitable for 20+ years….

    Gotta love Italy.

  10. Sigh…There have been rumors – over many decades – of Alitalia’s demise. Reading up a bit on the history of Alitalia would be helpful to understand that it isn’t going down.

    As another example, read up on Ireland’s Aer Lingus, same over decades. It still flies under, albeit under IAG. Nationalization to privatization to nationalization to privatization.

    The Italian state and people aren’t gonna let Alitalia go down. Read a bit on history to understand this: Alitalia is not Malev of Hungary.

    In Britain the talk is of RE-nationalization of the railway system. Remember BritRail? It might be coming back. Some lines, owing to poor performance – were taken back by the UK government two months ago.

    With COVID-19 look for many key industries, sectors to be taken under the government arm.

  11. Alliance-wise I think AZ might be a good fit for OW. It will strengthen OW’s presence in Europe without IAG’s influence.

  12. @ MKLDH:

    I really doubt that BA, IB and AY will consider it a viable idea… and OW members have a veto right for new entrants.

  13. In theory, the “old” Alitalia had RT flights from MEX to FCO….BUT I could never find their offices, supposing they had offices, or phone numbers here in MEX. Nothing on their https://www.alitalia.com/en_us/support/contact-assistance/alitalia-worldwide-contacts.html contacts page, so no way for prospective passengers like me here to even know which days of the week it operated.

    The telephone operators couldn’t help, either. The numbers they gave may or may not have been Alitalia’s, but no one ever answered anyway. The latest information (on the internet) was from 2016, and yes, it’s still there, without the flight numbers so you couldn’t easily book the flights: https://www.alitalia.com/en_gb/offers/all-offers/new-flights-mexico-city.html

    So, I wonder how many people simple went with the other airlines to Europe, even if they were going to Rome. I never gave Alitalia much attention, because of the frustration factor. Even when I went to Sardinia, I couldn’t contact Alitalia here in order to get any answers…so I bought a ticket with another carrier.

    I imagine they won’t fly here on the “new” Alitalia…but I hope they provide greater information to other cities’ potential customers. They were a total failure here in MEX.

  14. It should be split in two. Meaning ati and Ali. This was the way it was. Ali should only do intercontinental flight from Italy into the world market. Ati should be the inter-Europe airlines from italy . And a smaller net system within italy. There is no real Italian market. Italians do not use the system at hand. They don’t even use the rail system but are willing to pay a larger fuel bill for cars.but not rail. A greater road tax would resolve the issue. They will request for rail service or small Hope’s into regional airports. Italy has a great infrastructure. But they just do not see beyond two meters.

  15. So, government owned until they can find a new buyer.

    Hmmm. Why didn’t they think of that before? I’m sure there will a queue banging on their door….

  16. Not worried about AZ leaving SkyTeam, because AZ adds berry little value to the alliance with AF and KL just around the corner with more destinations, better facilities and more reliable operations.

    I think OW could be a good fit for AZ.

  17. In any other country this company would have folded many many years ago but in a country like Italy that is politically corupt they can never make Alitalia fold because the policians have too many friends and family members in Alitalia . For anyone from any other country you will never be able to understand how this country works.It is a real shame because only the honest people and companies suffer . In Italy we pay the highest taxes in just about any country in the world to pay our dishonest politicians crazy amounts of money ! Alitalia falls under our dishonest government regime. Lets burn more money in a company that just goes not work !!!!!

  18. In any other country this company would have folded many many years ago but in a country like Italy that is politically corupt they can never make Alitalia fold because the policians have too many friends and family members in Alitalia . For anyone from any other country you will never be able to understand how this country works.It is a real shame because only the honest people and companies suffer . In Italy we pay the highest taxes in just about any country in the world to pay our dishonest politicians crazy amounts of money ! Alitalia falls under our dishonest government regime. Lets burn more money in a company that just does not work !!!!!

  19. AZ is the worst. As an Italian-American. I am saddened that this is the best that Italy can do as far as a national carrier. I have been trying to secure a refund of over $300 related to Covid 19, to no avail. Even letters to their NYC offices go unanswered.

  20. @Marcello Ma tu sei scemo.

    However, Alitalia needs to fail, and undergo a thorough and intensive restructuring process. The italian state can’t keep pouring money and investing into a failure. It’s like fishing in a dry lake, you wont’ get anything out of it, you’re just wasting you time and it’s hopeless, however, though, I think AZ has potential and can improve a whole lot.

  21. I totally agree ! But we all know that Alitalia Is part of our Political regime and clan . Too many friends and family members are in Alitalia . They will never allow Alitalia to declare bankruptcy ! They will keep on pouring tax payers money into a lost cause.

  22. Union is the fault of everything of Alitalia to much power
    In few years is going to be the same and the stupid Italian is going to pay a lot of € for nothing
    (Italiani svegliatevi
    Prima che sia troppo tardi)
    Wakeup italians
    Before is to late

  23. Another money loser. It’s amazing how privileged airline employees can become to endless state support at the expense of their fellow citizens who typically earn much less than they do… think also Malaysian Airlines and South African Airways (until now).

  24. have a flight JFK to FCO next week. doesn’t appear they will cancel flight besides a voucher anyway to get a refund as not sure will be able to fly to Rome or anywhere anytime soon

  25. If you live in Italy and care about the stuff on this blog (travel, rewards, perks), the only real option is to become a Flying Blue loyalist. Why? It’s hard to avoid Alitalia if you want good schedules. And I fly Milan to Rome often. It’s also easy to get status on FB, which has some excellent lounges in CDG (AMS less so) and gives free bags to low level status (silver.) The downside is that FB miles are not that valuable, to me at least, and the earn rates are low.

    But if Alitalia joins OW, crediting to Alaska becomes an interesting possibility. That might mean long haul flights on Alitalia to take advantage of Alaska’s earn rates. Not the best option, to say the least. Than again, at least the cabins are usually half empty on Alitalia…

    So I think I’ll root for Alitalia to join OW. It might be interesting. Unless I’m overlooking something? (I have no idea if OW would be amenable.)

    BTW, the government will never let Alitalia fail, at least not totally. Politicians generally like to keep their jobs. In key parts of Italy, aviation is economically and culturally significant.

  26. @Lars- eurobonds are not for current or past debt levels. I always like to see when people prefer to say rubbish instead of trying to learn more.
    Lufthansa is not in a much better shape. They already asked for a bailout.

  27. About, the report of a person called ?LARS?
    Hallo my dear,
    First of all I would remind you that the 600mil€ bond to Alitalia are not a German concession, maybe this guy feels like they won the Second World War, but this could be,obviously, only an historical fake.
    I would remind this guy that in 2012 Italy had to save the Private Germans Banks from bankrupt, because of their extraordinary exposure with , and we had to put 40bilions Euro in the ESM which was created in 2011 with the ‘excuse’ to help nations in financial crisis not able to respect the stability agreement. (And the exposure of the Italians private banking was only 10bil.) A bankruptcies of German banks would have collapse again Germany after 1945.
    Then I would remind to the guy, the Gentleman Agreement of London on 27/02/1953 where Italy and Belgio, Canada, Ceylon, Danimarca, Grecia, Iran, Irlanda, Italia, Liechtenstein, Lussemburgo, Norvegia, Pakistan, UK , Irlanda, France Spain, USA, Svezia, Swiss , Unione Sudafricana and Jugoslavia, just to help Germany, decided to cut 50% of the war debits, 15miliars of marks.
    Than I would remind to the guy the illegality of Germany in not paying penalties on the surplus.
    Then at least but not last I would remind to the guy that the German government decided to Nationalize Lufthansa, which is the last years we all know has always revived money from the State , to adjust the counts….
    Then Italy is in Europe the 2nd export country and every years pays 14bil€ to Europe, compared to the 16 of Germany….
    You should study and understand more the world around you.
    Regards
    Marco

  28. is Alitalia air not flying to Canada or the USA anymore or they cancelled there flieghts until the end of the year2020

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