Alitalia news: auction collapses, government mulls options

[Globaliser]

For anyone who has plans to fly Alitalia, or is contemplating doing so, the outlook has just become a little more clouded. BBC News reports:-

Alitalia auction ends in collapse

 

State-owned airline Alitalia faces the threat of administration after Italy said the auction for its stake in the national carrier had closed.

 

The move comes a day after rival airline Air One - the last serious bidder - pulled out of the process.

 

Rome said another declared suitor, the US buyout firm Matlin Patterson Global Advisers, would not present a binding offer by the 23 July deadline.

 

The auction flop leaves the future uncertain for the loss-making airline.

 

Italy's commercial airline Air One withdrew from bidding for up to 49.9% of the government's stake amid restrictive sale conditions which would compromise its ability to turn around Alitalia, which currently sheds more than 1m euros ($1.3m; £672,000) a day.

 

Other suitors, such as Russian airline Aeroflot gave similar reasons for leaving the sale process, and also complained about not being given "critical information" relating to Alitalia's financial position.

 

Alitalia has been loss-making for years, struggling against fierce competition, high fuel costs and crippled by industrial action.

 

"We are already reflecting on what do in the future. There are various options on the table," said Prime Minister Romano Prodi, but did not elaborate.

About the only certainty is that the Italian government will not be permitted to put any more money into the airline. That leaves few options.

[luvdasea]

Globiliser, Any more word on Alitalia? I was thinking about flying them next year JFK to FCO, because I have kids and would like an overnight, direct flight. (which they seemed to have alot of) But it doesn't seem like a good idea to fly them now. I have about a month before the tickets open up. Do you have any suggestions?:)

[Globaliser]

Nothing much new at the moment - just the usual crop of coat-trailing and rumours. It'll be some weeks yet before there's any firm news, complicated by the fact that the holiday season is just about to start so nobody in government or business will be doing much work in the near future.

[luvdasea]

Thanks. Please keep us informed.

[cruisemagnet]

Globiliser, Any more word on Alitalia? I was thinking about flying them next year JFK to FCO, because I have kids and would like an overnight, direct flight. (which they seemed to have alot of) But it doesn't seem like a good idea to fly them now. I have about a month before the tickets open up. Do you have any suggestions?:)

 

 

I would highly recommend that you fly another airline. My wife and I, along with friends flew Alitalia to Europe in 2005 to from JFK to FCO. Having been warned by others not to do so, I decided to take a chance. BIG MISTAKE! It was the worst flight I have ever flown. The food tasted like cardboard, the service was lousy, and the crew didn't seem to care. I have taken quite a number of international flights, and Alitalia was the worst I have ever flown. The fact that they are still flying today is shocking to me.

[Globaliser]

As the thread has floated to the top, this is the last few days' worth of news:-

 

26 July 2007: Lufthansa's finance chief Stephan Gemkow said that LH would look again at Alitalia if the conditions of the sale of the Italian carrier changed dramatically. (Reuters)

 

26 July 2007: Air One would be interested in bidding Alitalia again if the government changes terms and conditions. (AP)

 

30 July 2007: The Italian economics minister said that Italy cannot hold private talks to sell the government-controlled airline Alitalia SpA. The courts "would not allow it." The minister already had ruled out liquidating the carrier, saying "there are no judicial or economic grounds to do so." (AP)

 

31 July 2007: A newspaper report said that Alitalia's board may indicate tomorrow to the government its preferred alliance partner. The operation would favour Air France-KLM, which has a commercial agreement with Alitalia, or Lufthansa. The board is also due to examine a new business plan for Alitalia which could result in a cut in the less profitable routes and an increase in flights from secondary Italian airports to European destinations. (AFX)

[luvdasea]

I saw that Alitalia is code share partners with Delta--Does this mean that it might not be good to book on Delta either? Delta seems to have alot of flights to FCO also.

[Globaliser]

As a matter of practicality, if Alitalia withdraws wholly or partially from a route which is operated by both airlines, you're probably more secure if you're booked on a Delta-operated flight than if you're booked on an Alitalia-operated flight, whatever the flight number on your ticket - simply because Delta is likely to continue operating their flights even if Alitalia stops theirs. (If you're booking on a codeshare flight, you have to be told which airline is operating your flight when you book, so you should always be able to find this out before you book.)

 

The other thing is that you're more secure if you have an issued ticket, rather than just a reservation (even if you've paid for it). If you have a 13-digit all-numeric ticket number, then you have a ticket. The ticket is the contract between you and the airline. Without an issued ticket, your position is rather more precarious.

 

However, choosing between a Delta-operated flight and an Alitalia-operated flight sometimes seems to be like choosing between the devil and the deep blue sea. But maybe the improvements that Delta seem to have made to their international flights are real and long-lasting, and not just a flash in the pan.

[FlyerTalker]

However, choosing between a Delta-operated flight and an Alitalia-operated flight sometimes seems to be like choosing between the devil and the deep blue sea.

Could it be an expression of whether you want to be scowled at in a language you understand vs one that you don't? :) Then again, the same can be said about Air France ground service.

[ab0si]

Could it be an expression of whether you want to be scowled at in a language you understand vs one that you don't? :) Then again, the same can be said about Air France ground service.

 

OK, I'm confused.

 

Air France ground service? Isn't that like military intelligence? Government paperwork reduction?

 

In addition, there is a big difference between service from Delta and service from Italy's finest:

 

Delta staff is ALWAYS there to scowl at you whle Alitlia's need to take time off for their frequent 4-hour strikes.

 

Bad jokes aside, AF has really improved in recent years. CDG is still CDG though. :)

 

Paul

[Kindlychap]

I would highly recommend that you fly another airline. My wife and I, along with friends flew Alitalia to Europe in 2005 to from JFK to FCO. Having been warned by others not to do so, I decided to take a chance. BIG MISTAKE! It was the worst flight I have ever flown. The food tasted like cardboard, the service was lousy, and the crew didn't seem to care. I have taken quite a number of international flights, and Alitalia was the worst I have ever flown. The fact that they are still flying today is shocking to me.

 

I've just done Heathrow to Brindisi, outward via Rome, inbound via Milan.

 

Pleasant service, roomy plane, food okay, drinks on every leg - even the one hour one - and timekeeping on arrival okay. A bit flakey on departure, but they know how to make time up!

 

Check in at Brindisi was appalling - mainly due to the combination of the Italian contempt for a good British queue and the boards giving misleading information. We tried a "when in Rome" approach, queue jumped better than an Italian (thank you to my lovely wife for that one) and got the plane.

 

I'd fly them again if I go again to Brindisi - considering that the alternative is Ryan Air - when my family went out on one of those flights a day later, there was no toilet from Standsted to Bari!

 

Best bit - it was cheaper than Ryan Air!

 

Matthew

[JohnL1935]

We flew on Aliltalia Oct of last year on a non stop from Newark to Rome and the flight was uneventful. TV was not as good as US carriers and the attendants were not as friendly but maybe they were on strike and we didn't know it. They weren't coming up and down the aisles every hour with drinks but they had wine, juice, soda and water on a cart at the rear of the plane. The food was excellent for an airline and I was impressed with the quality. We are leaving again at the end of this month so as long as they keep flying I'll give a second opinion. Their rates were the lowest I could find by $200-$300 for a non stop.

 

John L.

[Krazy4Kruisin']

We flew Alitalia in 2000 from Rome to Barcelona and back again after the cruise. For some reason, which I can't remember now, we were late getting to the flight on the way back. But because we had 1st class tickets, the counter agent called the gate agent, and they actually held the flight for us.

We are flying them again next year from Rome to Venice and back after another cruise. I sure hope there will be no problems.

[Globaliser]

Not news, but a batch of rumours/talk stories yesterday which range from the interesting to the downright silly.

 

AirFrance-KLM to listen if approached on Alitalia:-

PARIS, Aug 9 (Reuters) - French-Dutch Air France-KLM said on Thursday it remained watchful of developments at loss-making Italian flag carrier Alitalia, which the Italian government is seeking to sell-off, reaffirming it wanted to take part in consolidation of the airline sector.

 

Air France-KLM, a partner of Alitalia within the Skyteam codesharing alliance, did not take part in a failed attempt by the Italian government earlier this year to sell its stake because the conditions were not right, Air France-KLM Managing Director Pierre-Henri Gourgeon told a conference call on the airline's first half results. He noted Alitalia had since got a new chairman.

 

"We remain watchful. If we are approached, we will listen," said Gourgeon.

...

Alitalia attracts Chinese, Pacific funds interest:-

MILAN (Thomson Financial) - Chinese and other Pacific region funds are interested in acquiring Alitalia SpA, said Massimo Notaro, president of the Union Piloti trade union.

 

Reports say the newly-appointed chairman of Alitalia Maurizio Prato is to launch contacts with possible buyers of the airline.

 

'A Chinese fund and a Pacific region fund are interested in Alitalia,' Notaro said, noting Australia's Macquarie was until recently a major shareholder in Aeroporti di Roma.

...

Ryanair CEO says would not buy Alitalia:-

MILAN (Thomson Financial) - Ryanair Holdings PLC CEO Michael O'Leary said rival airline Alitalia SpA needs restructuring, and he would not buy the airline even if it was being given away for free.

...

[Globaliser]

Alitalia bids announced:-

Competing bids from Air One and a consortium led by Italian lawyer Antonio Baldassarre have been submitted following Air France-KLM’s move for the state-owned share of Italian carrier Alitalia yesterday.

 

The deadline for bids ends at lunchtime today (7 December) and Alitalia’s board of directors will meet again next week to select its preferred proposal.

 

The biggest surprise was German carrier Lufthansa’s decision not to enter the auction. Air France shares soared following the news, as the Franco-Dutch carrier is now the front runner – it already has a cross-shareholding and commercial alliance with Alitalia.

 

...

[fti]

I flew Alitalia round trip in business class twice in the past 12 months and was actually very pleased with their business class service. Haven't flown them in economy yet.

 

Every airline has had problems and comments on the good/bad of an airline are very subjective, be in Alitalia, Delta, or whoever.

[Globaliser]

Italian government backs Air France-KLM bid for Alitalia

Rome supports Air France bid for Alitalia

 

By Adrian Michaels in Milan

Published: December 29 2007 02:00 | Last updated: December 29 2007 02:00

 

The Italian government threw its weight behind Air France-KLM's bid for Alitalia yesterday, risking union stoppages and disruption in the early part of the new year.

 

Tommaso Padoa-Schioppa, finance minister, said the offer from Air France-KLM "offered the best prospects" for Alitalia. Air One, an Italian airline, had also offered to buy Alitalia, which is heading rapidly towards bankruptcy and riven by industrial unrest.

 

The government's decision does not, however, guarantee that Air France-KLM will buy Alitalia. It means only that the two companies will enter an eight-week period of exclusive negotiations followed potentially by a binding offer from Air France-KLM. The government is hoping that the companies will find agreement. "There are no alternatives," Mr Padoa-Schioppa said in an interview yesterday.

 

...

And some comment from The Times:-

Head in the clouds over Alitalia deal

 

Carl Mortished: World briefing

 

January 2, 2008

 

Gluttons for punishment, members of the Air France-KLM board are preparing for marathon negotiations with the Italian Government over a takeover of Italy’s bankrupt flag carrier. The Franco-Dutch company won the right to exclusive talks by bending over backwards to accommodate Italian sensitivities.

 

Leaks in the local press even suggest that Air France will preserve Alitalia’s identity, placing 51 per cent of the airline into a trust controlled by Italian interests, a similar arrangement to the complex takeover by Air France of KLM. This is ominous and should give Jean-Cyril Spinetta, the Air France-KLM chairman, pause for thought.

 

Even before the parties get down to talk dirty, the right-wing ranters of Italy’s Northern League are threatening protests over the likely retreat by Alitalia from Malapensa, the airline’s northern hub, which flies international routes for the convenience of Milan’s business community. Everyone assumes that an Air France-owned Alitalia will shuttle the Milanese jetsetters to Paris or Amsterdam for long-haul journeys.

 

...

[teach2travel]

Just the mention of Alitalia makes me laugh! We flew with them last summer, from Heathrow to FCO. Uneventful going, coming back...another story! First, we were 2 1/2 hrs leaving FCO.....no real reason given. When we finally took off, they put the moviw on...Disturbia. You could choose English or Italian. I, and the people around me, choose English, but the sound kept breaking up, and finally went out. Never having seen this movie, and sitting on the edge of my seat...we figured Italian was better than nothing (no, I do not speak Italian, but any sound is better than no sound at all). OK...so we get to the very last scene of the movie.....the one where you are holding your breath to see what happens, and they turn the movie off!! :mad: Talk about suspense!! Oh it gets better....since we were late taking off....I was concerned about making my connection flight. I asked one of the flight attendants about the proceedures for handling this, his reply, "you are going to be late." Everyone around me let out a big huh?? I did complain to another flight attendant, who was abit more helpful. When we did get in, we stood in line 1 1/2 hrs to get another flight...with probably 3/4 of the others off the plane. This is getting long......put up in hotel, no where near airport.....had to get own transportation to and from airport. Alitalia, huh??? :rolleyes:

[ItaliaAmerCruzLady]

ok, I`m a little slow on the draw here, but we are booked for June, on Alitalia to Rome, non-stop, I just found this site, and frankly you people have made me a little nervous. What would happen if they are no longer in business? what would be our alternative? Also, do they actually feed you on an overnight flight, where you are boarding at 9pm and deboarding at 11am Italian time? (normally we wouldnt be eating overnight, and it would be technically 5am our time.:confused:

[smeyer418]

ok, I`m a little slow on the draw here, but we are booked for June, on Alitalia to Rome, non-stop, I just found this site, and frankly you people have made me a little nervous. What would happen if they are no longer in business? what would be our alternative? Also, do they actually feed you on an overnight flight, where you are boarding at 9pm and deboarding at 11am Italian time? (normally we wouldnt be eating overnight, and it would be technically 5am our time.:confused:

 

It won't be out of business. More than likely it will be bought by Air France and the worst that will happen is they will consolidate flights. On a night flight they tend to serve dinner and drinks let you sleep and then serve breakfast. You can find out for sure by looking at any booking engine and they normally tell you what they serve. Personally I like Alitalia's food better than any US airline(in coach)...

[ItaliaAmerCruzLady]

Thank you for responding SMeyer, I feel slightly better, just hoping that us flying in a day early will be enough of a buffer if things dont go to plan, would hate to miss our cruise!

Do you suppose the airline would contact us or our TA to inform us of any changes in a timely manner so that we can make other arrangements?:eek:

[smeyer418]

Thank you for responding SMeyer, I feel slightly better, just hoping that us flying in a day early will be enough of a buffer if things dont go to plan, would hate to miss our cruise!

Do you suppose the airline would contact us or our TA to inform us of any changes in a timely manner so that we can make other arrangements?:eek:

 

I would keep checking every couple of days by calling. The airlines are notoriously bad at this. Did the TA arrange the flight or did you? TA's make no commission from Airlines unless its a special push so don't expect much from the TA.

[ItaliaAmerCruzLady]

TA made these arrangements, I am not quite sure how to go about checking on our flights, but I guess contacting Alitalia directly with our flight confirmations should be sufficient. I sure hope we dont have to make other arrangements, I was really happy with the cost of this flight, it was a few hundred cheaper than most of the other airlines. This could be why.

[Globaliser]

I was really happy with the cost of this flight, it was a few hundred cheaper than most of the other airlines. This could be why.

Usual airline story: If it's cheap, that's often because there's something wrong!

[smeyer418]

Usual airline story: If it's cheap, that's often because there's something wrong!

 

that really not necessarily true. Southwest is cheaper no frills and is not something wrong. I don't think anything is wrong with Alitalia and I would bet the Italian government doesn't want to close it down. They would rather sell it and have someone else close it down in a year or two.....