Alitalia Will Shrink Fleet, Cut Free Food & Drinks, And More

"The banks which are supposed to lend money to Alitalia are Intesa SanPaolo and Unicredit, the 2 biggest banks in Italy with massive political implication and infiltration"

How much more can I say? This is almost identical to Swissair. They had UBS and Credit Suisse wanting 50-51% stakes in the company before it went under.

Yup, a million dollar loan is my problem. A billion dollar loan is the bank's problem.

The Italian banks, which will ultimately get bailed out by the EU.

Alitalia is yet another example of an old adage in the airline business. "In the airline industry, the barriers to entry are few, and the barriers to exit are many."

I think it's the other way around, Gregg.

@keitherson: right, the Germans, et al. So, maybe LH should just buy Alitalia now, and dismember it. It'll save Germany more $$ in the long run!

@Bill: they're already buying Air Berlin, so why not?

@snic, No, the way I wrote it is the way it is. Any fool with $5 million to burn can start an airline. But try to let an airline die a natural and rightful death can be very difficult. Alitalia is a prime example. Market forces clearly dictate that this carrier should have gone out of business years ago, but banks and others continue to throw money at it in hopes that SOMEDAY it will finally turn around. SABENA was another example. For years it was propped up by the Belgian government; you just couldn't kill it. Only after all of the many barriers to exit were finally passed did the carrier go out of business only to be reincarnated under a different name.

With millions of Americans, Canadians and South Americans of Italian extraction -- to say nothing of the romance surrounding all things Italian -- it is amazing that Alitalia has failed to capitalize on its national brand in North and South America. Why anyone would fly Delta over Alitalia to Italy is beyond me. This should be a no-brainer.

Lets be clear that nothing mentioned in their business plan is ground breaking and just following what everyone else has already done for years. What Alitalia is doing is matching the current European short haul service offerings as both the LCCs and now the mainline carriers are following such as BA. This will definitely reduce costs and increase profit revenue. Parking 20 aircraft whilst reducing their workforce to 12000 employees, actually right sizes the employee count to the aircraft total based upon current seat load factors which in tandem will raise the load factor from the current 75-80% up to 90%. So again reducing cost twofold. Renegotiating all the service ground and support contracts to equal the competition, is a very doable cost reduction. So a total reduction of cost base to allow an approx €400 million is completely attainable by 2019. €500 million is possible if they can get at least 40% of bookings to be made directly with them. Where the other €500 million in savings comes from is Italian magic! (Maybe the Italians charge a lot of aircraft parking fees lol)

I just returned from the USA on Alitalia (BLQ - FCO - LAX / JFK - FCO - BLQ). What can I say? My wife and I travelled business class to LAX and Economy from JFK. The service was good and on time. As a matter of fact, on both legs, AZ managed to deliver us an hour early to LAX and BLQ. The crew was kind, considerate and efficient. The food was excellent in business class and basic in economy. The wines were Italian and top notch.

With crews like that they should be making, not loosing, money! If I didn't know Italy well, I might even have expected the employees to buy out either one or both shareholder(s) themselves.

Perhaps the problem is having chosen Rome as the sole hub. Rome means It.Gov, the Vatican and little more in-between, which translates into a lot of domestic flights at the taxpayers' expense! Nobody takes AZ to get to Beijing, Mumbai, Tokyo or Melbourne via Rome and their just aren't enough Italian tourists or businessmen in the greater Rome - Naples area with global interests either. Get real guys!