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Alitalia: renationalised and relaunched (again)

Premium Analysis

Alitalia underwent the latest in a long series of relaunches in late Jun-2020. Very much a soft launch, and strategic details remain unclear. Only a legal name change from Alitalia SAI to Alitalia TAI, a device to facilitate a return to state ownership, signals its new start.

Italy's perennially loss-making national airline has EUR3 billion of state funding and new management. Francesco Caio, a telecoms and banking executive who led Poste Italiane, is appointed president, while Fabio Lazzerini is promoted from chief business officer to Alitalia's CEO.

In view of the state funding, the EU is to investigate whether or not the 'new' Alitalia is really a new activity. According to Competition Commissioner Margrethe Vestager there must be "economic discontinuity" with past operations to qualify for state aid.

Alitalia carried 21.3 million passengers in 2019, broadly the same as in 2009. It missed out on a decade of growth, while low cost competitors grew their share in Italy.

Lacking cost efficiency on short haul and scale on long haul, it will be a massive challenge for Alitalia to reach a 2022 breakeven target.

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