The Italian government announced, on Tuesday 17 March, that it intends to nationalise the airline Alitalia, which has been in great difficulty for years, as part of emergency economic measures taken in response to the COVID-19 pandemic.
The Italian Council of Ministers “foresees the creation of a new company entirely controlled by the Ministry of Economy and Finance, or controlled by a company with a majority public shareholding, even indirect”, a press release states. The government does not specify the time limits or other more concrete arrangements for this project to nationalise Alitalia.
According to media reports, Rome has earmarked an overall budget of €600 million for the entire national aviation sector, in which Alitalia accounts for the lion's share.
Alitalia has been accumulating losses for years and had to be put under administration in 2017. Rome has been searching for a buyer or buyers since then, without success.
Alitalia, faced with extremely fierce competition from low-cost companies, cannot really compete with other traditional companies either. It loses about 300 million euros a year. The former national airline flew only 22 million passengers in 2018, compared with 91 million for Easyjet, 142 million for Ryanair and some 180 million for Lufthansa and Delta Airlines. In Italy, its market share is 14%, far behind Ryanair's 25%.
In addition, the French Minister of Economy, Bruno Le Maire, stressed on Tuesday that the government declared “an economic war” on the coronavirus and that it did not exclude nationalising some large companies in danger, including Air France-KLM. (Original version in French by Lionel Changeur)