New’ Alitalia takes to the skies

After months of haggling with unions and frenetic talks with politicians seeking to save local airports, a new, slimmed-down Alitalia took to the skies today, after months of uncertainty as to its future after the former state-controlled airline filed for bankruptcy in August. “We’ve done it. There’s no turning back from the new Alitalia now […]


Air France-KLM Alitalia CAI consolidation


After months of haggling with unions and frenetic talks with politicians seeking to save local airports, a new, slimmed-down Alitalia took to the skies today, after months of uncertainty as to its future after the former state-controlled airline filed for bankruptcy in August. “We’ve done it. There’s no turning back from the new Alitalia now and all the prophets of misfortune have been silenced,” said Labour Minister Maurizio Sacconi, whose government had made saving Alitalia a top priority. Italian investment group CAI paid just over 1 billion euros for Alitalia in December, with Air France-KLM, Europe’s biggest airline, recently coming on board as a key shareholder with a 25 per cent stake estimated at nearly 323 million euros. But in a stark reminder of the lingering challenges facing the reshaped carrier, Alitalia workers wary of the impact from a new alliance with Air France-KLM demonstrated at Milan’s Malpensa airport by chanting slogans and waving union banners, causing delays. At Rome’s Fiumicino airport, delays of more than two hours were reported as workers marched outside. Alitalia today shut down its all-cargo division and is preparing to take to the skies tomorrow under new ownership. An all-Italian consortium reportedly paid US$590 million for the troubled airline. The future of the carrier’s cargo division remains in limbo, however, after its three MD-11 freighters ceased operations to Hong Kong, Shanghai, Mumbai, Chennai, Japan, Korea and the US. But the involvement of Air France-KLM, Europe’s second-largest scheduled airfreight carrier after Lufthansa, in the newly privatised carrier, may breath a second life into the cargo division. The Alitalia Cargo fleet operated from Malpensa International Airport and since the bankruptcy problems began, other carriers have been steadily increasing their presence in the lucrative Italian cargo market. Air France-KLM CEO, Pierre-Henri Gourgeon said the acquisition of a minority stake in Alitalia was “nearly an ideal case.” Alitalia’s managers had the advantage of “defining the company at the bottom of the market,” he said. “We picked the assets, we didn’t take the debt. The cost of redundancies is covered by the government, and we have new employment contracts,” Gourgeon said. He added that by establishing the new airline now, amid a deep industry crisis, the operation should be well positioned for growth. The agreement will give Air France-KLM “the best possible access to the Italian market,” Gourgeon added. He acknowledged that Alitalia, recently merged with Italian rival Air One, faces a challenge in regaining its footing after foreign rivals expanded their hold on the rich Italian market over recent years.