General Industry

Alitalia's Successor, ITA, To Take Off In Mid-October

By Dave Simpson
Alitalia's Successor, ITA, To Take Off In Mid-October

It has been announced that carrier Italia Trasporto Aereo (ITA) will replace state-owned Alitalia and start flying in mid-October, after Italy reached a long-awaited deal with the European Commission following months of haggling over the fate of the old, loss-making airline.

The negotiations focused on making ITA independent of Alitalia to ensure it was not liable for paying back billions of euros the old carrier had received in state aid.

ITA, which will be fully operational from October 15, said in a statement it will aim to raise initial capital of €700 million to buy assets from the old company and begin operating.

Following the devastating impact of the COVID-19 pandemic on the airline industry, demand is beginning to recover but companies are still grounding many aircraft or flying nearly empty

The new airline, which was initially supposed to start operating in April, said that it is expecting revenue of just above €3.3 billion in 2025. It added that it will reach earnings before interest and taxes (EBIT) of €209 million and a break-even by the third quarter of 2023.


ITA will buy assets for its aviation business directly from Alitalia and it will bid in a public tender to acquire the carrier's brand, which it sees as "an essential element in carrying out its industrial plan" and was one of the European Union requirements for the deal.

The outcome of the negotiations also means ITA will inherit only part of Alitalia's flight slots, which are a major asset and proved a major sticking point in the talks.

ITA will get 85% of the Alitalia slots at Milan's Linate airport and 43% at Rome's Fiumicino hub.

The European Commission said that it will remain in close contact with Rome to ensure that the launch of ITA would be in line with EU state aid rules.

It added that its investigations into the €1.3 billion granted to Alitalia were ongoing.


Job Concerns

Transport Minister Enrico Giovannini said that the new company will be competitive in the national and international market and will have "significant development perspectives", but some members of the coalition government complained that the new plan is not strong enough.

National unions for the airline sector strongly rejected ITA's plan, describing it as weak and saying that the employment commitments are unacceptable.

ITA will initially operate a fleet of 52 planes, seven of which are wide-body, used for longer-haul routes. The number is expected to increase progressively to 105 aircraft in 2025.

Of the 11,000-strong Alitalia staff, between 2,750 and 2,950 will be employed in ITA's aviation unit this year, rising to 5,550-5,700 in 2025.

Up to 4,000 workers will likely be hired in handling and maintenance units.


An industry ministry statement said that it will "take charge of the social repercussions...activating safeguards to support the workers who will not find a place in the new company".

News by Reuters, edited by Hospitality Ireland. Click subscribe to sign up for the Hospitality Ireland print edition.