What do you even say about the mess that is Alitalia?
They’ve been a basket case for years, with powerful unions and a long history of political meddling. Every so often they get a bailout from one place or another. Air France put money in though it was obvious to nearly everyone they’d lose their shirt. They walked away, though leaving the airline even worse of with a joint venture that benefits Delta and Air France more than Alitalia.
Next in line with deep pockets was Etihad, who learned a lesson not to trust promises made by the Italian government and which ultimately pushed out its own CEO in part based on bad investments in foreign airlines. New uniforms, service training for flight attendants, and new business class seats were not going to turn around the airline.
Copyright: jvdwolf / 123RF Stock Photo
Alitalia had lined up additional bailout funds to keep operating, based on a fantasy plan of €1 billion in cost reductions over 2 years, wishing for a 30% increase in revenue, while reducing its narrow body fleet.
This plan and bailout required backing from unions who voted 4-1 against. And frankly I don’t blame them, even though it pushes the airline towards bankruptcy. It’s not unreasonable for them to believe:
- That a new bailout would be forthcoming anyway, since it has always come
- The management plan is ludicrous so they’d be back in the same position being asked for more concessions soon enough.
How Long Can They Claim This?
It’s a dangerous game on both sides because the airlines problems — both revenue and cost — are real. It’s been a consistent loser for a long time. Tinkering at the margins will not change that.
As the carrier prepares for a restructuring the best thing for everyone except the current owners and workers (the Italian people, passengers, the aviation industry) would be to let it fail. Europe has Open Skies and other carriers could come in and pick up assets and operate in Italy. Alitalia should be allowed to die, though it’s hard to imagine that actually happening.
In the meantime flight operations continue.