Italy has taken back the control of Alitalia that has been in administration since 2017 after Etihad stopped funding the chronically loss-making airline.
Italian media is reporting that the cost of renationalizing the airline would be 600 million euros, but this is certainly just for the next 12 months considering the burn rate
Here’s an excerpt from Ansa (access their piece here):
Italy needs a flag carrier, Transport Minister Paolo Di Micheli said Tuesday, confirming that Alitalia is to be renationalized.
“This experience (of the coronavirus) teaches us that a national carrier is strategic for the destiny of our country from many different standpoints,” she told Rainews24.
“This experience will confirm to us that we need our flag carrier”
And here’s from the Local (access their piece here)
One of the measures provides for the creation of “a new company wholly controlled by the ministry of economy and finance, or controlled by a company with a majority public stake, including an indirect one” to take over the airline.
Italy’s AGI news agency said the government was setting up an 600-million-euro fund to deal with the damage the pandemic has caused to the aviation sector.
We all know how competent the Italian Treasury has been over the years considering that the government debt stands at roughly 135% of the GDP second highest in the eurozone after Greece
Throwing good money after bad will ensure that billions more will be lost with the renationalized flag carrier and eventually paid by the Italian and/or European taxpayers.
This is now the sixth rescue since the “new” Alitalia was formed back in the late 1990s. The airline has burned more than ten billion euros trying to get its business back to profitability ever since.