Story ID: CBalitalia02072019
Alitalia Stresses Continued Improvement in Passenger Revenue
By: Cathy Buyck
Caption: Progress on the sale of the Italian flag carrier remains unclear, as Air France-KLM weighs withdrawing from a rescue deal.
Word Count: 302
Driven by what it described as the “excellent” performance of its international and intercontinental network, Italy’s embattled flag carrier Alitalia increased passengers carried and passenger revenues in January for the fourteenth consecutive month. Passenger revenues rose 4 percent year-on-year without aircraft fleet expansion, Alitalia said Friday.

Passenger revenues of long-haul services last month increased by 6 percent compared with the previous year and now represent 48 percent of total passenger revenues, a “value never achieved in the last five years,” it pointed out. The January performance follows the growth trend reported for 2018, when revenue from passenger traffic increased 7 percent compared with 2017.

Alitalia, which has operated under administration since 2017 and received a €900 million bridge loan from the Italian government to keep it afloat until it restructures and finds a buyer, has “recovered efficiency and quality of service,” said extraordinary commissioner Stefano Paleari. Speaking to Italian financial newspaper Il Sore 24 Ore, Paleari emphasized the progress came “despite the competitiveness of the market.” The company remains unprofitable, he said, but EBITDA losses halved to €153 million ($173 million) in 2018 and Alitalia expects to break even this year.

The airline plans to announce a new business plan and a deal with a new commercial partner by March, he said. However, growing political tension between France and Italy could jeopardize the planning.  Air France-KLM appears to want to withdraw from a rescue deal it had begun negotiating with its SkyTeam and transatlantic joint venture partner Delta Air Lines due to an escalating diplomatic row—the French government recalled its ambassador in Rome—Il Sole-24 Ore reported Friday. Italian rail company Ferrovie dello Statto, which is handling the rescue, had expected a formal commitment by the Air France-KLM board on Thursday, but it did not hear from the group, according to the Italian daily.