After months of discussion, Alitalia could well start flying again as a new airline in just a few weeks. Yesterday, Italian Prime Minister Mario Draghi met with senior figures in the transport and economy departments to finalize a plan for the struggling carrier. Details are slowly emerging about what the new Alitalia could look like.
Just one month after the European Commission presented Italy with a letter telling them to finally let Alitalia die, it seems as if Alitalia is preparing to rise from the ashes. According to media reports in Italy, a meeting between the Italian Prime Minister and key government officials and has led to a final plan for the airline.
Cutting the fleet in half
Reuters reports that a new airline, known as ITA, will take over all of Alitalia’s assets. This will include aircraft, slots, and employees. The new ITA airline will then begin operations, perhaps as soon as the end of April, with just 45 planes and around 4,500 employees.
However, as the final details have yet to be confirmed, other outlets are reporting ITA will be even smaller with just 43 planes and 2,500 employees. Currently, the airline has a fleet of almost 90 aircraft made up of Boeing 777s and Airbus A320s, A321s, and A330s.
Whatever size the new airline will be, the government seems keen to get it in the skies as soon as possible. Previously, the plan was to start flying in June. However, this has reportedly been brought forward by two months to the end of April to take full advantage of the loosening travel restrictions and growing summer demand.
Will competition laws come into play?
This new plan follows a recent bid to get German carrier Lufthansa to invest in the airline in the future. Lufthansa said in the past that changes would need to be made, and a smaller airline would be more likely to receive the backing of the German giant. While the government appears to be doing everything it can to please Lufthansa, it also needs the European Commission’s approval.
The European Commission (EC) has already said that it would object to any further state-aid for the struggling national carrier. The new plan would require a further €1-2 billion ($1.2-$2.4 billion) of funding. The EC has also said the new airline would need to rebrand and give up some of its slots.
With fewer aircraft in the fleet, having fewer slots shouldn’t be a problem. The slots are already being eyed up by other low-cost carriers, meaning the new Italian airline will have to face serious competition. The EC will also show an interest in the new airline if Lufthansa invests due to strict competition rules.
Lufthansa already has several subsidiary airlines in Europe, including Eurowings, SWISS, Austrian, Brussels Airlines, and more. Investing in another carrier may be seen as overstepping Europe’s rules regarding fair competition.
Ryanair has previously started a legal battle claiming state aid given to airlines like Lufthansa may be giving them an unfair advantage. If Lufthansa is financially stable enough to buy another airline after one of the worst years in aviation history, Ryanair may have a point after all.
Do you think Alitalia will survive as a smaller airline? Or will competition from carriers like Ryanair and easyJet prove too much for the new airline? Let us know what you think in the comments.