Italy’s new airline gives itself a year to find an investor

Italia Trasporto Aereo, the state-owned successor to Alitalia, is positioning itself for an investment from a major airline that could come as soon as the end of next year, according to Chairman Alfredo Altavilla.

The new Italian carrier, which started operations on Friday after its predecessor shut down, is too small to survive as a standalone company, Altavilla said in an interview. It is being managed in a way that will make it attractive for one of the large airline groups, whether in Europe or another region like the U.S., he said. 

“I’m looking for a deal to be completed by the end of 2022,” Altavilla said. “I certainly don’t want to go beyond that.”

A deal with another carrier has been part of the plan since Mario Draghi’s government tapped Altavilla to lead the airline, to be dubbed ITA Airways, according to the 58-year-old executive, once a top aide to former Fiat Chrysler chief Sergio Marchionne. The new branding is intended to signal a break with the past of Alitalia.

“I do remember very well how thankful people at Chrysler were when they got a second opportunity,” Altavilla said in the interview. “I sincerely hope, wish and trust that the people working with ITA today feel that they have been given the opportunity that they deserve.”

Altavilla said he’s been approached by all the major carriers in Europe and the U.S. Delta Air Lines Inc. CEO Ed Bastian said this month that discussions are underway over a possible alliance.  

The airline reached an outline agreement to buy new Airbus SE aircraft last month and agreed late Thursday to purchase the Alitalia name, ensuring it will have global brand recognition. 

Still, ITA will face fierce competition from discounters such as Ryanair Holdings Plc, EasyJet Plc and Wizz Air Holdings Plc on domestic and regional routes, while major airlines in Europe and the U.S. dominate the profitable trans-Atlantic routes.

“It was crystal-clear to me that this company can’t survive standalone, even if all the stars were to align for a tremendous rebound in the travel market,” Altavilla said. “Size does matter today and is going to matter more and more going forward.”

Alitalia had been under state administration, and the carrier hemorrhaged as much as 700,000 euros ($812,000) a day and racked up years of losses. Estimates on the total burden to taxpayers since 2008 ranged at around 10 billion euros at the time of its rescue.