Italian carrier Air Italy, part-owned by Qatar Airways, is to cease operations. All of its services will be taken over by other operators effective immediately. Shareholders of Air Italy have decided to place the carrier in liquidation following a meeting on February 11, 2020.
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Massive Financial Loss After Rebranding
Air Italy, previously known as Meridiana, has had many big financial losses over the years. They lost 52 million euros in 2015, 46 million euros in 2016 and 57 million euros in 2017. The relaunch of Air Italy required significant investments, some of which were necessary to resolve Meridiana’s historic problems. In 2017, Qatar purchased 49% of Air Italy.
The airline made some bad decisions with routes, like trying to launch flights to India and Thailand. Routes to Mumbai and Delhi were abandoned within days of starting, while service to Bangkok didn’t last. The completely new business model of the airline of operating out of Milan, rather than out of Palermo or Naples has taken a while to build up. The 737 MAX groundings have impacted their performance on short-haul flights in the past several months. The fleet size was increased to 15 from 14 the previous year. Unfortunately, that includes three 737 MAX planes, which are grounded. The airline has also reduced charter flying, which led to a loss of about 65 million euros. With all that added up, they reported a financial loss of 164 million euros in just one year after the rebranding.
Air Italy Goes Into Liquidation
Air Italy was 51% owned by the Aga Khan through his Alisarda company, with the remaining 49% held by Qatar Airways. The partnership was launched back in 2018 when the airline was renamed. After all the financial struggles the decision of the shareholders to liquidate the carrier comes as no surprise. However, Qatar Airways was ready to continue supporting the carrier.
From the official Qatar Airways press release:
“Despite our minority shareholder’s role, Qatar Airways has continuously provided all possible support to Air Italy right from the beginning, from releasing aircraft from our fleet and ordering new aircraft for Air Italy, to backing management choices and injecting capital and investment as required and permitted.
For this reason, Qatar Airways was ready once again to play its part in supporting the growth of the airline, but this would only have been possible with the commitment of all shareholders.”
From 11 to 25 February 2020, all Air Italy flights will be operated by other carriers at the times and on the days previously scheduled. All the passengers who booked flights after February 25, 2020, will be refunded or booked on other airlines. You can find the official press release from Air Italy here.
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About the author: Mila Kostic is a native of Belgrade, Serbia. After majoring in sociology at the Belgrade University she has been working as tutor and coach. Prior to taking on her role at Mighty Travels, she wrote for a video games, fitness, and health lifestyle website. After starting her work with the Mighty Travels team she discovered her passion for travel and travel writing. Now, she is focused on bringing you the newest travel news. In her portfolio here at Mighty Travels, you can find articles on Airline news, hottest credit card deals, tips and tricks on earning miles and much more. You can reach her at [email protected]
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