Targeting Italy, Ryanair Raises Concern Over New Flag Carrier Funding

Ryanair CEO Eddie Wilson has expressed his frustration about authorities injecting money into the Italian airline industry amid the continuous financial difficulties with Alitalia. The executive has even shared he isn’t afraid to take action if necessary.

Ryanair 737-800 Italy
Ryanair is looking to offer 100 routes in Italy this summer. Photo: Getty Images

Significant figures

Last month, we reported that the European Commission granted an additional €12.8 million ($15.5 million) in state funding to struggling Alitalia following three previous rounds of aid. This money comes at a time when officials are attempting to transfer the flag carrier of Italy’s assets to a new national airline – ITA.

Amid this ongoing support, Ryanair’s leadership is not a fan of the series of cash injections. The low-cost carrier has a strong presence across the whole of Europe, and Italy is one of the key markets for it. The carrier flies to nearly 30 destinations in the country, and Milan-Bergamo is one of the busiest airports across its network, flying to approximately 80 destinations from there.

Wilson shared the following about his concerns with Alitalia and its restructuring, as reported by la Repubblica:

“Look, I have the impression that there is nothing really new, that in the end Ita will be the extension of Alitalia. With the usual problems already seen for decades: money drained from public resources to pour it into those of a company that today, as in the past, it will lose money: when the market and the economy were doing well Alitalia lost. When the crisis was seen and Covid changed our lives, Alitalia went even worse.”

Alitalia Airbus A330-200
ITA is also preparing to take off this summer. Photo: Getty Images

Wanting a piece

Wilson was asked if Ryanair was interested in any of Alitalia’s assets. He then went on to explain the issues regarding the new airline having the same slots as its predecessor.

“Well, first of all I tell you that we don’t need any brand: Ryanair is the best brand, the best known and most profitable in this sector. The problem with Linate and Fiumicino slots is that Alitalia cannot take public money by pretending to be a newco with the same slots as the old Alitalia: they must be released to ensure competition between all airlines.”

Overall, Wilson was happy to share that he is eying up any potential slots opening up. He concludes that the market has changed and that ITA would not have great opportunities due to Ryanair’s and other low-cost carrier’s stronghold on short and medium-hail trips. He insists that the Italian outfit should focus on the intercontinental market.

Ryanair Boeing 737-800 Landing
Ryanair is interested in slots at airports such as Milan Linate. Photo: Getty Images.

Industry concerns

Finally, Wilson was asked what Ryanair would do if more euros are injected into the new company. The businessman replied that his company would “take our steps,” but expresses that it is clear that this is “illegal aid,” so his firm will defend its interests.

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Altogether, Ryanair has always been outspoken when it comes to state funding. Last year, it challenged the European Commission when it came to aid to airlines such as Finnair, SAS, Air France, Lufthansa, and KLM. Additionally, the Irish airline shared its dismay about TAP Air Portugal’s bailout.

Ryanair itself has received government-backed loans since the rise of the pandemic. Nonetheless, the company has around $4 billion in cash reserves. So, it should have no problem weathering the storm if the global health crisis continues to rock the industry further.

What are your thoughts about Ryanair’s concerns regarding Alitalia’s funding? What do you make of Eddie Wilson’s sentiments? Let us know what you think of the situation in the comment section.