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Alitalia dies after 75 turbulent years, hands over to ITA By Reuters

© Reuters. FILEPHOTO: Alitalia airplanes can be seen on Fiumicino International Airport’s tarmac. This is where talks between Italy & the European Commission regarding the overhaul of Alitalia will begin. It was held in Rome, Italy on April 15, 2021. REUTERS/Remo Kasilli

By Francesca Landini

MILAN (Reuters – Alitalia will end its 75-year-old legacy as a symbol of Italian glamour and style. Italia Trasporto Aereo, the downsized successor, will take over operations on Thursday.

Alitalia is the tradition choice for popes, prima donnas or Italy’s elite political class. Since 2017, it has been administered by state administrators to keep it from being liquidated.

After a series of restructurings, the last bow of the 1946-founded airline will be marked by a night flight departing from Cagliari in Sardinia. It will land in Rome around 2100 GMT.

The company is now in the red after only one year. The government has rescued it many times and spent over 8 billion euros (roughly $9.27 billion) in just three years.

Alitalia died in political turmoil, as has been often the case over its life. The far-right party Brothers of Italy blamed Prime Minister Mario Draghi for the death.

Giorgia Moloni, leader of the party, stated that today we were losing another gem: a company that was a part of history in our country and made us proud to call ourselves Italians.

After having tried to sell Alitalia on to private investors in 2020 Rome succumbed to the terrible consequences of the pandemic that struck the airline industry and decided to start ITA.

This new airline, where the government will invest 1.35billion euros in three years, will begin with 52 aircraft and 2,800 employees. Alitalia had around 110 planes and 10,000 workers.

In order to conclude a contract with the European Commission there should be no clear separation between Alitalia, its successor and the new carrier. Additionally, the new carrier must prove profitable before the expiration of its 2021-2025 business plan.

However, ITA may struggle to forget Alitalia’s past of high cost, poor management, and large political and trade union influence.

Alitalia is currently in negotiations to purchase the brand of this new carrier. The traditional green-white and red livery will be maintained by the new carrier.

A nimbler airline was launched, but it raises questions about what the future holds for the more than 7000 Alitalia workers. They will be subject to a temporary layoff plan paid for by government up until September 2022.

($1 = 0.8630 euros)

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Mike Robinson
Mike covers the financial, utilities and biotechnology sectors for Street Register. He has been writing about investment and personal finance topics for almost 12 years. Mike has an MBA in Finance from Wake Forest University.