FRANKFURT/ROME (dpa-AFX) - After years of negotiations, Lufthansa will officially join the Italian state airline Ita this Monday (January 13). For management and crews, a lot will change, not least because of EU competition requirements, but passengers will also face drastic changes. In Italy, however, the entry of the Germans into the proud Italian airline is not seen as entirely positive.
What have the partners agreed?
Lufthansa will initially receive 41 percent of the shares in Alitalia in exchange for a capital contribution of 325 million euros. This step is to be officially completed on Monday. It has been agreed with the Italian Ministry of Economy and Finance that the Germans can take over the company completely in two further steps if the numbers add up. The Italian state would still be on board if Lufthansa were to take over a 90 percent majority in the second step. The complete takeover could then follow by 2033, for which a total of 830 million euros is being discussed.
What role did the European Commission play?
Under pressure from the EU Commission, the Lufthansa Group has made concessions to limit the market power of the new alliance. Take-off and landing rights in Milan and Rome had to be given up to competitors. In addition, Lufthansa has already canceled three routes to North America and in the future will have to give preferential treatment to passengers of the competitor International Airlines Group (IAG), the parent company of British Airways and Iberia, as well as Air France, when flying to their hubs.
What does this mean for customers?
First of all, Lufthansa was able to "optimize" its offering between Italy and its other home markets. For customers, this could mean higher prices with roughly the same number of seats available. The EU's requirements are intended to create competition here. On short- and medium-haul routes, the low-cost airline easyJet, which is already operating in Italy, will play a central role. It is setting up two additional bases in Rome-Fiumicino and Milan-Linate with eight aircraft. From there, it will offer 27 new routes, six of them to Germany. Destinations include Munich, Hamburg, Frankfurt and Düsseldorf.
How is Ita doing?
According to Lufthansa strategists, Ita no longer has anything in common with its loss-making predecessor Alitalia. Lufthansa CEO Carsten Spohr has described Italia Trasporto Aereo (Ita), founded in 2020, with its state-of-the-art Airbus fleet, as a "start-up in the middle development phase". Ita CEO Antonino Turicchi has forecast a turnover of 3 billion euros and a small operating profit of 40 million euros for the 2024 financial year. Further savings should also be possible within the group.
Who will be the boss of the new Ita?
Lufthansa's strategy chief Jorg Eberhart, who has already managed the regional subsidiary Air Dolomiti, which is active in northern Italy, for almost eight years, is being discussed in the group as the new Ita boss. The manager also played a central role in the takeover negotiations. The election of the new five-member management committee is planned for the first Ita shareholders' meeting after Lufthansa's entry.
What will change for Ita passengers?
For existing Ita customers, which include Pope Francis, who regularly travels abroad, many of the details of their flight will change. With the change from the airline alliance Skyteam to the Lufthansa-dominated Star Alliance, partner airlines for any onward flights change, as does the infrastructure provided, such as airport lounges. Lufthansa wants to integrate Ita's frequent flyer program Volare into its own Miles & More, and corresponding offers to evaluate status and miles should be coming soon.
What do Italians think of the Germans' entry?
The Germans' entry into the proud Italian airline has not been met with approval everywhere in Italy: for some, it is a serious insult that a powerful German company is buying into Italy's state airline. The satirical supplement of the Italian newspaper La Stampa recently mocked the new Ita-machine as an oversized sausage, with the black, red and gold lettering "New Alitalia – Enough of the spaghetti eaters".
Italian politicians did not want to be seen as completely powerless at the end of the negotiations, on the verge of sealing the deal. In the final phase of the price negotiations, the ministry in Rome threatened to let the deal fall through. When Lufthansa tried to lower the price for the second tranche at the last second, the ministry responded, "Italy will not sell its company." In the end, however, an agreement was reached.
What does Lufthansa want with Ita and Rome airport?
First of all, with this deal Lufthansa is buying a piece of the lucrative aviation market in Italy. With almost 100 aircraft at present, Ita will immediately become the largest foreign company in the group. Italy, as the third largest EU economy, has traditionally strong ties to America and is also one of the top destinations for numerous international tourists.
The modern airport in Rome-Fiumicino will become the sixth and southernmost hub in the extensive Lufthansa Group, which already combines the former state airlines of Germany, Austria, Belgium and Switzerland under its umbrella. Spohr is particularly focused on expanding the network in the direction of South America, but Africa and Asia also offer market opportunities./ceb/DP/zb