Meridiana: how to escape the impact of loss-making Italian airlines?

Even after some years of joining together to fight the foreign invasion by LCCs, this has not been a great year for Italy's loss-making established airlines. The Alitalia Group, formed from the merger of Alitalia and Air One, has had to seek additional crisis loan funds from its shareholders and the Meridiana airline group, formed from the old Meridiana, Eurofly and Air Italy, has undergone a recapitalisation.

CAPA recently analysed Alitalia's new 2013-2016 industrial plan and, in this report, we turn our attention to Italy's second indigenous carrier. Meridiana is even more heavily loss-making than Alitalia. Its fleet is ageing, its international network is sub-scale and its dependence on the domestic market is likely to bring it into ever more competition with Europe's leading LCCs, while its unit costs mean it is likely to continue to struggle to compete with them.