Italy: New airline ITA to replace Alitalia

Rome: New airline Italia Trasporto Aereo (ITA) will replace state-owned Alitalia and start flying from October, the Italian economy minister said.

The announcement followed a breakthrough in talks between Italy and the European Commission after months of negotiations over how to carve out a role for the new carrier and make it independent of the struggling Alitalia.

The move to keep ITA separate from Alitalia is to ensure it would not be liable for paying back billions of euro the old carrier had received in state aid, Reuters reports.

The economy ministry said that discussions with the Commission had resulted in a “constructive and balanced solution, which guarantees the discontinuity needed to comply with European law.”

The ministry confirmed that Alitalia will cease operations on 15 October, the same day that its slimmed-down successor ITA becomes “fully operational.”

The Commission, tasked with policing state aid in the EU, said it remains in close contact with Italy to ensure that “the launch of ITA as a new and viable market player is in line with EU state aid rules.”

The European watchdog also continues to investigate the €1.3 billion that Alitalia received in state funds between 2017 and 2019.

The new carrier will reportedly begin operations with an initial capital of €700 million which it will use to buy assets from Alitalia, with aims to break even by the third quarter of 2023.

ITA will start off with a fleet of 52 planes, with the number of aircraft rising to 78 next year and reaching 105 by the end of 2025, reports Italian news agency ANSA.

ITA will inherit only part of Alitalia’s flight slots, Reuters reports, obtaining 85 per cent of Alitalia slots at Milan’s Linate airport and 43 per cent of slots at Fiumicino in Rome.

Alitalia currently has a staff of 11,000. Reuters reports that between 2,750 and 2,950 will be employed in ITA’s aviation unit this year, rising to 5,550-5,700 in 2025, with up to 4,000 workers likely to be hired in handling and maintenance units.

Italy’s transport minister Enrico Giovannini said the new company would be competitive both nationally and internationally, and that it has “significant growth prospects.”

However national airline unions have slammed the new company’s employment commitments as “unacceptable,” reports Reuters.

ITA faces an uphill start thanks to a challenging economic situation caused by a general fall-off in air travel due to the covid-19 pandemic.