Alitalia Employees Vote On Liquidation Over Pay Cuts & Layoffs

The losses, delays, bailouts and 'strategies' will just continue in this spiral of hopelessness for years to come. They'll be in no better position in 2019 than they are now.
What is the reason Alitalia is so unprofitable while airlines like Iberia and Aegean seem to be doing ok? Poor management? Unprofitable routes? Corruption? Perhaps before looking for solutions they could agree on what the cause of the problem actually is?

@lucky
Actually, just to add a few things to your post, in Italy special laws were enacted in 2003 regarding hard financial situation for firms. It's pretty likely that this situation will evolve towards the so called "Special Administration". According to this law, both BoD and CEO given (partially)up their power in favour of a "special commitee" nominated by the Govt. This commitee, namely "commissario", has special powers to run the company over the upcoming months, in which he's allowed, by law, to deny payment towards non-operative debts. By doing so it's easy to understand that the financial situation may get SLIGHLY better. But what's the price of this? At the same time, this "commissario" will try to find new investors, given that the govt. will not bail out, willing to acquire specific profitable assets of the company (in someone may find any): law allows to split the company into different assets that may be sold separately. However, the consequence of this whole chaotic situation is the enormous loss in the company's value, even because any possible buyer is obliged to deny (by law) any layoff during the first 2 years, which may sound pretty unlikely. So if this option of turning the financial situation better and selling the airline (maybe to LH?) at ridiculous prices sounds hard to achieve, the other pathway is simply called "bankruptcy". We'll see, but the other question here is: what is going to happen to AZ travellers?

Employees don't believe the government will allow Alitalia to collapse - that's rational given the history and long term unprofitability

If the government will never allow it to collapse, then there is no incentive to vote for your own pay to be cut - that's rational as well from a personal perspective

The key problem is the lack of the normal capitalist pressure valve of letting failing companies fail. This is cited as a key reason why US airlines, BA etc were able to negotiate restructuring with employees (as they really might disappear and you have no job), whereas basket cases like Air France and Alitalia limp on year after year, as it's irrational for the employees to take cuts since they don't fear losing their job because the government is always there.

If the government has to provide more funds again (according to some European newspapers, Alitalia has received more then EUR 10bn of tax payer money over the last 20 years), then they start to rival Etihad and Qatar Airways in terms of subsidies received 😉

I'm so sad that my first comment on this beautiful site has to be on my beloved and, unfortunately, now failed flag carrier. First of all Alitalia had always been more a "wage factory" as we say in Italy (i.e. government run firms that have just the aim of giving wages to people in order to get back votes) and when it started to be a private company the labour unions, used to incredible privileges and benefits in the public past, revolted. Here in Italy unions are more a political fact than something useful to workers, and in particular in former government run companies like Alitalia. Allora the leased aircrafts were leased in the years where money was not a problem since government backed, but then after several failures and being private the money started running out quite fast. I am so disappointed that such a touristic country like Italy can't have a good major carrier that links her to other major touristic destinations or tourists dense like China or the US West coast. Now I should end my contribution, since it's quite long and boring... Sorry for my lamentation, a deluded Italian flyer

"What is the reason Alitalia is so unprofitable while airlines like Iberia and Aegean seem to be doing ok?"

South European mentality in combination with old legacy (read: expensive) airline. Iberia was a mess until bought by IAG, and Aegean doesn't have the old legacy baggage. More or less all European legacy carriers have had to make big changes in recent years. Dealing with the economics is easy, dealing with the unions not so much.

@Traveler
Up next:
1. UA/DL/AA complain about Alitalia.
2. TSA adds laptop ban to Italy.

@W

Hahahahaha nailed it

Italy itself is on the brink of collapse. Only the endless "free money" from the ECB is propping it up. Bailout out Alitalia would be a violating of the "no state bailout" clause of the EU. If it happens regardless, the ECB must pull the plug and Italy goes under.

I have reservations on Alitalia this summer, will I still be able to fly? Should I look at getting a refund? Is that even possible? I am nervous.

@ Matteo, I can sympathize. Congratulations on your first post! Welcome!

Looks like the wildly promoted snazzy new outfits helped the bottom line.

Workers even voted against the unions who sponsored the plan. That's bad, even for Italian standards. I've seen countless AZ "near-failures" but this is by far the worse. My 2 cents: AZ will be restructured as a small long-range airline serving some high-yead tourist markets, while EasyJet & Ryanair will step-in as the de facto national carriers.

I'm curious for some justification for the 'catastrophic consequences' statement...

I have reservations for 12 of us in less than 4 weeks fro Boston to Rome. Does anyone know what typically happens in these situations? Do they just stop flying in a few weeks?

@Rob L
Italian media are quoting company sources assuring that flights "in the immediate future" won't be affected.
AZ never stopped flying altogether in its troubled history, so if that were to happen, it would be a HUGE surprise...

Rob L, I have the same problem, I have tickets from São paulo To Rome in 3 weeks, and really worried!!!!

I do not believe that government could stop AZ operations at the beginning of high season. It could collapse tourist flow in Italy as AZ is the biggest tourist carrier here. More likely they will appoint "comissario" to let company surviveat least till November to mitigate bad consequences for tourist indestry.

The problem is that all reports say Alitalia only has cash for another 2-3 weeks of operation. I hope they figure it out.

The catch is that AZ is providing an "essential" public service. That's the loophole the gov't can use to grant some extra "emergency" funds.
All you guys shouldn't be too worried.

I hope so Marcello! Months and months planning this trip...

AZ will be bailed out until the end of time or until the Italian state itself completely runs out of money. At this point Italy itself will be bailed out... by Germany.

So this is just part of the master plan for the Germans to ultimately pay for everything. Smart people, those Italians.

"historically" Alitalia got bailed out over and over - but the EU has tightened the rules over the years and at some point, their patience will be over... it's time for Alitalia to go out of business.
And Alitalia is no longer the largest carrier in Italy - RyanAir already passed Alitalia regarding number of passengers carried in Italy, easyjet is hard on their heals.

Hi. I'm worried because I have tickets booked for May..Alitalia won't refund but I am concerned that the ticket from Italy won't be valid if they go into administration. I wish I'd booked with another airline...i foresee lots of problems by the end of May & I'll be stuck in Naples!!

What information do you have that forces a lot of problems by the end of May Elaine? I am not saying there won't be but wanted to understand why you made that statement. I also have flight plans at the end of May into the beginning of June. From all I have read, the Italian government fully understands there is a huge tourist season and the reason they got the approval for the 400 million euro is to keep things running throughout the summer. I certainly understand things can fall apart in a hurry but it seems as though things for the next 30 days or so should be ok. What do you know that I don't? The 400 million won't happen unless they go into administration so I personally want that to happen.