Mario Draghi, head of the Italian government since February, faces his first major economic challenge: how to save Alitalia from bankruptcy when negotiations with Brussels on this issue are stalled.
In March, at the start of the state aid negotiations, the two sides boasted a “constructive” debate, but since then the tone has risen dramatically.
“We are embarking on a real battle” with the vice president of the Commission in charge of Competition, Margrethe Vestager, “to make him understand the importance of having his own airline,” said Under Secretary of the Treasury, Claudio Durigon.
In the street, “I am assaulted by Alitalia employees dissatisfied with the fact that Alitalia is not being given what is given to Lufthansa and Air France,” complained the Minister of Economic Development, Giancarlo Giorgetti.
Fully affected by the health crisis, Air France-KLM and Lufthansa received public aid of 10 billion euros (11.7 billion dollars) and 9 billion euros (10.5 billion dollars) respectively.
– ‘Batch sale’ –
Very angry, Alitalia unions demonstrated in Rome on Tuesday to protest against the company’s “batch sale” and delays in paying their wages.
In a letter sent to Rome and revealed by the Italian press, Vestager expresses his “concern about the lack of substantial progress” in the negotiations with Rome and demands that the new company that is allegedly born from the ashes of Alitalia clearly breaks with its ancestor.
The previous government headed by Giuseppe Conte created in 2020 a public company to save Alitalia, baptized Ita, in which it intended to inject 3,000 million euros (3,500 million dollars).
In 2017 and 2019, Alitalia received loans from the state for a total of 1.3 billion euros (1.5 billion dollars). Brussels, examines whether this aid complies with competition rules.
Under pressure from the European Commission, Alitalia’s recovery project aspirations have been revised downward. Now it is a fleet reduced by half, to 45 aircraft, and the staff would be cut to 4,500 employees in the aviation sector.
Maintenance and ground services would be sold separately.
In total, the company employs more than 11,000 people.
Mario Draghi seems to have given a clear order to his ministers, but difficult to achieve: “we must negotiate a plan for Ita that allows him to” fly with his own wings “without posing a burden to the community.
“Italian taxpayers have already had to spend tens of billions of euros in the last 30 years to keep a very poorly managed company afloat,” Massimo Colombo, professor of economics of innovation at the Polytechnic School of Milan, told AFP. .
“The airline sector has experienced a significant concentration movement in recent years, Alitalia will not be able to survive alone, it needs a private partner,” he added.
– Big losses –
For international flights departing and arriving in Italy, its market share was 7.8% in 2019, far behind Ryanair’s 23%.
Alitalia has accumulated losses of 11,400 million euros (13,400 million dollars) between 2000 and 2020. Its turnover fell again 65% to 1,100 million euros (1,300 million dollars) in 2020, due to the pandemic.
Should we save Alitalia at all costs?
“I do not believe that the Italian state should put its hand in its pocket again to rescue Alitalia,” Andrea Giuricin, a transport economist at the Bicocca University in Milan, a supporter of the sale of the airline’s assets, told AFP. market.
“A new Alitalia under minimums will hardly be able to resist competition from large companies such as Lufthansa and Air France and from low-cost companies such as Ryanair or Easyjet,” he added.
Draghi, who knows very well how the European Union works, will he find a solution?
According to Giuricin, “he will not come to a confrontation with Brussels and will seek a way to minimize the use of public money.”
bh / gab / eb / erl / me