It would appear that this could actually be the end for Alitalia, as Italy’s government has signed a decree to establish a new national airline.
Alitalia to be replaced by ITA
Details have now been revealed about Italy’s new national airline, which will be the successor of Alitalia. A decree has been signed by Italy’s Economic Development Minister, Finance Minister, and Labor Minister, in support of the new airline.
Italy’s new national airline is for now being referred to as “Newco,” but the expectation is that it will have the name ITA (which stands for Italia Trasporti Aereo). ITA is expected to launch in early 2021.
Italy’s Transport Minister has stated that the new airline will “bring Italy to the world.” She claims that the new airline will represent a “clear discontinuity” from the past.
The establishment of this new company is the first step towards creating a new national airline, which Italy’s Finance Minister says will be “a quality carrier capable of competing on the international market,” which will be “solid and sustainable.”
Why is a new airline even being created?
Alitalia has been in limbo since 2017, when Etihad cut off the airline. Etihad had owned a 49% stake in Alitalia, but didn’t want to sink any more money into the airline, realizing a turnaround was unlikely to ever happen.
At that point the Italian government started supporting the airline, while trying to find a private investor. As you may have guessed, roughly zero progress has been made there in the past three years.
Based on that, the Italian government has decided that:
- There’s value in having a national airline in Italy
- It’s more efficient to start from scratch than to try and fix Alitalia
There are lots of questions, few answers
The reality is that as of now there are very few details about what Italy’s new national airline will look like. Just about the only thing that has been clarified is that the airline will be full service, rather than being a low cost carrier.
I sure have lots of questions, including:
- To what extent will planes and staff be transferred over from Alitalia to ITA?
- Is the airline planning on buying new planes, as there were recent discussions about Alitalia possibly being interested in 787s?
- Alitalia is continuing to fly, so when will Alitalia cease operations?
- Will ITA try to join oneworld or Star Alliance? Alitalia had been kicked out of the SkyTeam transatlantic joint venture, and presumably management sees some value in joining an alliance?
- How does this strategy compare to the plan the government had earlier this year, where a new company was going to be formed that would take over 100% of Alitalia’s assets?
- How will this whole thing not be a disaster in the same way that Alitalia was, since the odds of success for a government owned Italian airline seem rather minimal?
Bottom line
Italy’s government is now taking concrete action towards creating a new national airline that will replace Alitalia. The airline will be named ITA, and the plan is for it to be a full service, global airline.
While the government promises that the new airline will offer a “clear discontinuity” from the past, I’m skeptical. Nonetheless I’m very curious to see how this situation evolves.
What’s your take on Italy’s new national airline?
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