“New Alitalia” Set To Obtain AOC, Begin Ticket Sales

The time may have come to say goodbye to Alitalia. The new state-owned company created by the Italian government to replace the chronically money-losing Alitalia is now taking shape and is on track to obtain its Air Operator’s Certificate (AOC) during the week, and after then it will be possible to launch the website and start selling tickets.

The “changeover date” between the old Alitalia and the new company ITA (Italia Trasporto Aereo) was set for October 15 by the Italian Government in cooperation with the European Commission that is overseeing the process to make sure that everything is being done in compliance with E.U. laws concerning state aid. However, Alitalia is currently selling tickets even past the official date of its demise because ITA is not yet an airline from a juridical standpoint and is therefore unable to sell tickets.

The Government has earmarked 100 million Euros ($118 million) to allow Alitalia to refund all tickets being sold for flights that will not be operated: according to the Italian newspaper Corriere della Sera there will be 255,000 passengers that will need to be reimbursed.

Two aircraft previously part of the Alitalia fleet, an Airbus A320 and an Airbus A330, have already been transferred to ITA and have already performed a test flight under the new ownership. This is a necessary step to allow the Italian regulator ENAC (Ente Nazionale Aviazione Civile) to grant ITA the AOC.

A temporary website, with limited functionalities to begin with, is already being prepared to ensure ITA will be able to go on sale as quickly as possible after the arrival of the AOC. At the same time, Alitalia will start canceling flights that will not be operated after October 15 and will progressively shut down its operations.

Assets purchase still to be completed

Subsequently ITA will focus on completing the purchase from Alitalia of the aviation unit, as well as preparing to take part to the public tender for the purchase of other assets that were excluded from the private sale by the intervention of the European Union. ITA will have to bid for the handling and the maintenance units of Alitalia, and then it will also have to make a competitive offer in order to obtain the Alitalia brand, together with its IATA callsign (AZ) and the ticketing accounting code (055).

The frequent flyer program MilleMiglia will not be part of the asset transfer and will not be pursued by ITA that has already announced the launch in due course of a brand new, modern frequent flyer program. The new program will probably offer a “status match” to existing MilleMiglia premium customers, but it is still unclear what will happen to the miles held by those customers. Technically speaking, unredeemed frequent flyer miles are part of the liabilities in the balance sheet of an airline, and since Alitalia will be declared bankrupt once the asset transfer is completed, it is likely that those miles will be written off as customers will be considered unsecured creditors of a company in liquidation. However, given the sensitivity of the issue, it is likely that some solution will be found to avoid the loss of all miles on behalf of the customers.

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Vanni Gibertini

Vanni fell in love with commercial aviation during his undergraduate studies in Statistics at the University of Bologna, when he prepared his thesis on the effects of deregulation on the U.S. and European aviation markets. Then he pursued his passion further by obtaining a Master’s Degree in Air Transport Management at Cranfield University in the U.K. followed by holding several management positions at various start-up carriers in Europe (Jet2, SkyEurope, Silverjet). After moving to Canada, he was Business Development Manager for IATA for nine years before turning to his other passion: sports writing.

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