ITA buys Alitalia brand for one third of starting price
ITA – Italia Trasporto Aereo (AZ, Milan Linate) has acquired the Alitalia (AZ, Rome Fiumicino) brand and website for EUR90 million euros (USD104.5 million), less than one third of the starting price of EUR290 million (USD336.7 million) that Alitalia’s commissioners were hoping for, it was revealed late on Friday, October 15.
The new state-owned carrier took over from Alitalia early on the same day, as anticipated, operating its inaugural flights starting with one from Milan Linate to Bari departing at 0620L (0420Z).
Despite buying the Alitalia brand, ITA also unveiled during a press conference its own new brand, logo, and blue livery. ITA Airways has a new frequent flier programme too, called Volare.
“The Alitalia brand was acquired with the aim of managing the transition to the new livery and reserving the right to future uses of the brand,” it said in a statement.
“Discontinuity doesn’t mean denying the past, but evolving to keep up with the times,” ITA President Alfredo Altavilla explained, adding that the slimmer fleet, workforce, and network will allow it to compete with low-cost carriers while offering better service and connections.
“ITA Airways is being born right-sized, in the optimal dimensions both in terms of the size of its fleet and its destinations,” he told journalists, as quoted by Associated Press. “We don’t carry with us the negative inheritance of being too big to conflict with the economic reality.”
ITA will employ 2,800 of Alitalia’s 10,500-strong workforce – to increase to 5,750 by 2025 – and operate 52 aircraft, less than half of the flag carrier’s pre-Covid fleet. These seven widebodies and 45 narrowbodies will grow to a total of 78 in 2022, with the gradual inclusion of new-generation aircraft that will reach 75% of the fleet’s total by 2025, with 105 new aircraft.
An agreement with Air Lease Corporation “will provide for the leasing of an additional 31 new-generation Airbus aircraft – long-, medium- and short-haul,” ITA said in its statement. Air Lease Corporation currently provides just one aircraft to Alitalia/ITA, an A330-200, the ch-aviation fleets advanced module shows. The new livery will be introduced gradually, on these aircraft.
There will be a network of 44 destinations and 59 routes, to increase to 58 destinations and 74 routes in 2022 and 74 destinations and 89 routes in 2025. Charter flights have also been launched, the first between Milan Malpensa and Rome Fiumicino carrying football team Inter Milan.
ITA Airways will focus activities on its Rome Fiumicino hub and on Milan Linate, “where it will position itself as the reference airline for business and leisure traffic.” Pending the identification of a strategic partner, it will join the Skyteam alliance. Negotiations with unions are ongoing in an effort to avoid the kind of protests and strikes seen in the runup to Alitalia’s formal demise.
In an interview with Bloomberg News, Altavilla said that ITA was too small to survive as a standalone company and was positioning itself to be an attractive investment for a major airline or group of airlines – an investment that could come by the end of 2022. ITA will face fierce competition from budget carriers on domestic and regional routes and from large European and US airlines on transatlantic routes.
“It was crystal-clear to me that this company can’t survive standalone, even if all the stars were to align for a tremendous rebound in the travel market,” he said. “Size does matter today and is going to matter more and more going forward.”