Alitalia will receive no more bailout money from the Italian government. Following its €900m ($1bn) bailout in 2017, it is in the process of receiving a further €400m ($447m) loan from Rome. However, Industry Minister Stefano Patuanelli has been clear that no more state intervention will take place, warning that the carrier could be shut down by mid-2020 if it fails to find a buyer.
No more money for Alitalia
It seems like the end of the road is edging ever closer for beleaguered Italian airline Alitalia, as the government has now said it will not release any further money to the carrier. Industry Minister Stefano Patuanelli told Italian newspaper Il Messaggero that the more recent loan, announced in late December, will be the last for the airline.
Patuanelli confirmed on December 21st, as reported in Reuters, that a €400m ($447m) loan had been granted by the government. However, he warned that no more taxpayer money would be used to keep the struggling carrier afloat, saying,
“This is really the last state intervention for Alitalia.”
He further warned that the company needed to find a buyer by the middle of this year, or the airline could be shut down entirely. CH-Aviation reports further comments from the minister, saying,
“We have six months to save Alitalia. The goal is to close a deal within half a year, with the expiry of the mandate of the commissioner. Otherwise, it shuts down. The EUR400 million loan has been disbursed. There will be no other funds.”
Losing €2m a day
We previously reported that Alitalia is losing as much as €2m ($2.2m) every day. The carrier has been ‘bankrupt’ since 2017, going into special administration after employees rejected the latest austerity plan to save the airline. Despite this, it continues to fly, propped up by injection after injection of public money.
In May 2017,the government granted a €300m bridging loan, followed by an additional €600m in October that year. None of the €900m granted that year has been paid back. Since then, various deadlines for buyers to express interest have come and gone, with a variety of potential investors named as showing interest, each one dropping out for one reason or another.
Most recently, Lufthansa has been eyed as the potential savior of the Italian airline. However, nothing official has come forward, and this is starting to look very much like wishful thinking on the part of the Italians. Lufthansa already has an Italian subsidiary (Dolomiti) and is more interested in making Eurowings profitable than taking on another lame duck.
However, it’s not all bad news for Alitalia. Despite being unable to turn a profit, the company’s most recent financial results showed that revenues were up 1.6% for November 2019. Its intercontinental growth has continued to drive forward, with the company lodging the 25th consecutive month of revenue increases by this arm in November last year.
The airline has also recently signed a codeshare with Azul in Brazil. This is set to expand its network to 19 new Brazilian destinations. It is also lining up a new route to San Francisco from Rome in summer 2020.
That is, if it lasts that long.