Alitalia, all doubts about Ita
What are Ita's plans? And will it really be able to take off instead of Alitalia? The analysis by Alfredo Roma, former president of ENAC, for International Affairs
After the EU green light for the industrial plan, the new Italian airline will depart on October 15 with less than 3,000 employees and 52 aircraft. A balanced budget is expected in 2023. Intercontinental routes will be operated immediately. The new Alitalia will be called Ita.
Is this the sign of discontinuity that the Commission wanted? If Ita wins the tender that has been opened on the Alitalia brand, everything will be as before. Examining the history of Alitalia's last twenty years , the real discontinuity is achieved with governance entrusted to competent and well-paid managers to avoid past scandals. And this regardless of public or private ownership. Frankfurt and Chicago airports belong to public institutions but good management produces profits. A second question is how a newly formed company can have an air operator certificate (Coa) in October, which requires an in-depth analysis by ENAC also on the persons responsible for the technical part. And if Ita wins the open races on maintenance and handling, this will also bring us back to the starting situation.
There is talk of the hubs of Fiumicino and Linate. Apart from the fact that the latter is not a hub, what will happen to Malpensa? There is talk of an Ita capital increase of 700 million with which it will be able to purchase the assets necessary to operate from Alitalia. This could be an insufficient sum, unless these assets are sold at a very low value, leaving the losses of the liquidation of the old Alitalia to the taxpayer, as happened in 2008.
FLEET AND STAFF
At the beginning Ita will operate with 52 aircraft, which will become 78 in 2022 and then reach 105 at the end of 2025. It is not said how many of these aircraft will be of short, medium or long range. There is no telling who is the manufacturer (Boeing, Airbus, Embraer?). There is no telling how many will be bought or leased, which makes a huge difference in cost. We are talking about new generation aircraft. What is meant by the new generation? The development of the long-haul is still profitable until here too the low-cost ones arrive, but it is not said with how many aircraft these routes will be covered.
Ita will start operating with 2,700 employees which will become 5,700 in 2025. How many will be flight crew and how many ground? Will they be hired by drawing on those of Alitalia? And those of Alitalia who have always worked with fixed-term contracts since 2008 will have to change jobs?
THE ECONOMIC RESULTS
The Business Plan was approved with a turnover that in 2025 will reach 3.3 billion euros, with an economic result (Ebit) of 209 million euros and an operational breakeven to be achieved by the third quarter of 2023. The pandemic has created enormous losses to air transport and it is not known what a recovery trend may be, also because we do not know when we will really be out of this pandemic, given the new restrictions that are increasing every day in the face of the spread of the Delta variant.
It is therefore natural to place some reservations on the forecasts of the Ita plan for 2025 because the world economic scenario in which we will move in the next four years appears extremely variable. It should be remembered that carriers are the weak link in the air transport value chain. The other actors are: airports which enjoy the monopoly of the traffic basin (passengers always choose the nearest airport), air traffic control which is a state monopoly and large-scale distribution which is an oligopoly. The carriers are those that suffer the effects of competition, which since the liberalization of European air transport in 1993 has become unsustainable, especially for small companies not organized at least on the parameters of low-cost: a single type of newly built aircraft, few downtime, modest salaries and paid services.
In Fiat, the new president of Alitalia chosen by Mario Draghi, Alfredo Altavilla, was considered tough but of great value. We hope that it can really represent a positive discontinuity with respect to the old Alitalia, also in relation to its annual emolument. It is good that the ministers Enrico Giovannini (Sustainable Infrastructure and Mobility) and Giancarlo Giorgetti (Economic Development) support maximum transparency for this new experiment, also by releasing more complete information to the taxpayers who have borne all of Alitalia's previous losses.
Article published on affarinternazionali.it
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/smartcity/tutti-i-dubbi-su-ita/ on Mon, 26 Jul 2021 04:24:33 +0000.