Alitalia has cost taxpayers and creditors $8 billion since 2017.

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5 years ago

Alitalia, in insolvency proceedings since May 2017 and which the Italian State wants to nationalize, has cost 8 billion euros to taxpayers and creditors between 2017 and 2020.

This is what emerges from a study by economist Andrea Giuricin for the Bruno Leoni Institute -one of the most reputable think tanks in Italy-, which points out that “Italian air transport is experiencing the hardest crisis in its history” due to the coronavirus pandemic, EFE reported.

The study recalls that the Italian government has set aside 3 billion euros to inject liquidity into the new company when it is nationalized, in addition to the two loans of 1.3 billion to guarantee its operability delivered by Rome since 2017.

Add to that $300 million in interest that the company will have to pay back, $400 million received this year in state aid for the pandemic crisis and another $3 billion it is accumulating in debt.

In total, 8 billion euros that will be paid by citizens and creditors.

The study estimates that this year in Italy “the number of passengers will fall from 161 million in 2019 to less than 50 million, the lowest level since before the liberalization of the sector in 1997, when there were about 53 million passengers”, as a result of the crisis of the COVID-19.

Alitalia also adds the financial problems it has been dragging on for years, since it has not made a profit since 2002.

In April of this year, the Italian government announced that it would once again nationalize Alitalia, after no private investor has been interested in buying it since 2017 as it stands, since the offers received had been from the business or had required a tough restructuring.

The document recalls that in 2016, Alitalia was in second place in terms of the number of passengers on the Italian market, behind Ryanair, the leading European low-cost company, and ahead of Easyjet and Vueling.

In 2017, Alitalia’s management prepared a plan to regain its competitiveness, which included 2 billion in new investments aimed primarily at the long-haul market, but also 2,000 layoffs from a workforce of 11,000.

The employees voted against it and the airline was put in the hands of the Italian state.