Alitalia, Italy’s largest airline, will suspend operations on 15th October, however the country plans to launch a new flag carrier called ITA on the same day.
1. The end of Alitalia
The 74-year-old airline, which includes Sophia Loren and the pope among its more famed passengers, comes to an end on 15th October. According to the airline, no new flights are available after this date and passengers with tickets for flights after this have the option to move up their trips or request a full refund. In recent decades the airline has struggled with strategic mistakes, inefficiencies and labour issues and has seen six failed rescue attempts in the last 12 years. It has also gone through €10 billion in government bailouts and loans since being privatised back in 2008. On top of this, the Covid crisis has caused extra stress, with the airline losing €430 million in the first half of 2020 when the crisis was at its worst.
2. ITA replaces it
On the same day, publicly-owned ITA airline 15 will start flying, buying all of Alitalia’s planes although stating it isa new and separate airline. Politico reported however that ITA does not plan to cover the old Alitalia aircraft with its own branding, and the company plans to bid in a public tender so it can buy the Alitalia brand and continue flying in its iconic livery. To customers therefore the new airline may not look so different. It remains unclear how ITA will integrate Alitalia frequent flier members, although the airline has said that travellers with flights after 15th October booked using miles could have them deposited into their accounts. A publicly-owned airline, Rome will be the biggest shareholder in new company ITA and will have access to €700 million of its €3 billion injection of public money.
ITA has a restructuring plan which includes several cost-cutting measures aiming to differentiate it from Alitalia’s issues. Whilst latter employed 11,000 people, the former has less than 3,000 workers (said to increase to up to 5,700 by 2025). The company stated that ITA staff will be under a new employment contract that “ensures greater competitiveness and flexibility” compared to rivals. Fleet wise, ITA will run only 52 “new green and technologically advanced aircraft” which is less than half of that of Alitalia, although this will grow to 105 by 2025. Additionally, ITA will retain just 43 percent of the slots held at Rome Fiumicino, Italy’s most expensive airport, and 85 percent of Alitalia’s routes at Milan Linate. ITA’s route map is not confirmed, however the company says it does plan to fly between Italy and New York, Boston, Miami, and Tokyo this year, with additional routes to Sao Paulo, Buenos Aires, and Los Angeles on the agenda for 2022.
