Struggling Italian flag carrier Alitalia is losing as much as 2 million euros ($2.22 million USD) each day. That's what Italian Industry Minister Stefano Patuanelli said last Thursday on the sidelines of an FIM-CISL (Italian Metal-Mechanical Federation) conference. This figure is a significant increase from the estimated loss of 700,000 euros per day publicized at the end of November.
Speaking at the aforementioned conference, this is what Industry Minister Patuanelli had to say about the situation:
"Alitalia loses two million a day, we are talking about a figure that depends on what time of year you look at why the cash flow is very different."
Patuanelli's comments make perfect sense as the airline would naturally see higher demand and higher load factors during peak holiday periods such as around Christmas as well as summer holidays. Conversely, losses would be much more intense during other times of the year. An average of 2 million euros per day equates to an annual loss of 730 million euros.
On Wednesday, while speaking at a parliamentary committee, Patuanelli had estimated a loss of nearly 2 million euros a day. This prompted the need to clarify as the Minister spoke to media the following day. According to Reuters, Patuanelli added that the airline’s new administrator Giuseppe Leogrande had the authority to release the final data on losses for this year.
Alitalia's new administrator
Earlier this month Italy’s industry ministry appointed a new temporary administrator for the airline. A lawyer by trade, Giuseppe Leogrande was chosen to lead the administration of the carrier and reconfigure the setup of the administration process.
According to AGI, the newly-appointed administrator Leogrande was a lawyer of the Bologna Bar since 1992. He was also the commissioner and president of Blue Panorama Airlines. Furthermore, he has academic experience in bankruptcy law, with a special focus on 'extraordinary administration procedure'.
Instead of a group of three administrators sharing responsibilities between them, Patuanelli intends to have a single person in the role. As such, he has requested that Daniele Discepolo, Enrico Laghi and Stefano Paleari resign from their current positions.
Leogrande's main goals are to cut costs and find a buyer for Alitalia. Hopes were initially high that Italian railway group Ferrovie dello Stato and infrastructure group Atlantia would set up a consortium with investment from Delta Air Lines but this did not materialize.
“As things stand, the conditions that need to be met in order for Atlantia to be able to take part in a consortium – set up to put together a binding offer for Alitalia – do not as yet exist.” -Atlantia via FlightGlobal
Conclusion
As Alitalia has failed to attract a suitable investor, there have been reports of it being nationalized. This idea may be the only viable solution for Italian unions, who are opposed to any solutions which would result in a significant number of lay-offs.
Do you think Leogrande will manage to find investors? Will he find a way to turn this airline around before it runs out of cash? Let us know in the comments.
Simple Flying reached out to Alitalia for more information on the administration shift but didn’t hear back before publication. We will update the article with any further announcements.