Competition watchdog: ITA must be independent from troubled Alitalia

The EU Competition Commissioner Margrethe Vestager expressed support for the Italian government’s plans to replace the ever-struggling Alitalia by launching a new substitute airline Italia Trasporto Aereo (ITA). 

Vestager had no doubts on Italy’s ability to find a “workable solution” regarding its aim to set up a new air carrier but pointed out that the investments into ITA must meet European market regulations as well as provide a return that would meet expectations of private investors.

The Commissioner stressed that the Italian government’s plan to create a new airline that could replace Alitalia might turn out well only if the new company would be fully independent of the old one. “I continue to believe we can find a workable solution. ITA has to be a real company, there has to be discontinuity otherwise ITA would be liable for Alitalia,” Vestager said during a news conference.

The EU Commission is yet to approve the business plan of the new flag carrier of Italy, under which ITA is expected to start flying with 45 aircraft putting a major emphasis towards short and medium-haul operations. Speaking about the new airline’s business plan, Vestager also outlined that investments in ITA “must have market conformity” as well as should assure “a return that would satisfy private investors”.

The new Italian airline was initially set to commence operations in April 2021 aiming to capture the wave of resurging summer season air travel. But due to prolonged negotiations between the local government and the EU Commission, the plan was delayed by three months to a current launch date of July 1, 2021. 

The latest disagreement between the government and the EU Commission due to which the launch date was postponed, was related to slot allocation at Milan Linate Airport (LIN), where ITA considered taking over a half of Alitalia’s slots. The Commission demanded that the new airline should inherit significantly fewer slots from the old air carrier.

The Italian government signed an air transport decree to establish a new airline in October 2020. The previous flag-carrier Alitalia has been operating unprofitably for years and filed for bankruptcy in 2017. 

The new airline is expected to focus on profitable Alitalia routes out of two of its main hubs, including Rome Fiumicino International Airport (FCO) and Milan Linate Airport (LIN). ITA also plans to operate flights within Europe and to North America with prospects to expand its network with destinations in Japan and South American as well as gradually grow the aircraft fleet over time.

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