Italy's flag carrier, Alitalia, will be nationalised in June, according to Industry Minister Stefano Patuanelli on Thursday. The carrier, which has been struggling with debt for years and has now seen a significant decline in traffic as a result of the coronavirus crisis, needs saving. Unfortunately, with a private buyer not secured, the airline will have to be nationalised.
Alitalia's losses are no longer sustainable. Having received billions in what Ryanair CEO, Michael O'Leary describes as 'illegal' state aid, a solution needs to be found and it seems nationalisation is the only option.
Patuanelli on Thursday also revealed that the government's intention was to initially own 100% of the shares. However, 'then we will have to see', he said.
From the beginning of June, Alitalia is expected to have been placed into a newco with a fleet of 'over 90 planes,' says the minister. This announcement therefore dismisses original claims that the airline would restart with just 30 aircraft from its current fleet of 113.
Furthermore, the government is renegotiating lease contracts in order to save costs. As for redundancies, the Industry Minister said it was 'very difficult' to talk about zero redundancies but assured that the transition would see as many jobs protected as possible.
The coronavirus crisis has put immense pressure on the flag carrier. Indeed, Italy has felt the effects of the pandemic hard, which had a knock-on effect on travel demand. Yesterday we reported on IATA's concerns in regards to the aviation industry. IATA said that potential revenue losses for Europe stood at approximately US$89 billion with passenger demand down 55%.