Economy

Air Italy enters liquidation in tough trading conditions

Air Italy enters liquidation in tough trading conditions”

Air Italy, the country's second-biggest airline after Alitalia, has suspended operations after its owners chose to liquidate the company, meaning flights booked after February 25 aren't guaranteed.

Qatar Airways said it was unable to bail out Air Italy due to European Union laws which limit foreign ownership of companies to a minority stake. Flights booked after that point will be refunded.

Air Italy was founded in 1963 under the name Alisarda to promote tourism on the Costa Smeralda in northeastern Sardinia and was renamed into Meridiana in 1990.

In a statement, Qatar Airways said that since the acquisition on 28 September 2017 of a minority stake in Air Italy, it has strongly believed in the company and its potential, supporting management's proposed business plan with a view to improving Air Italy's growth and job creation, with the addition of long-haul routes and numerous in-flight service improvements, in line with Qatar Airways' globally renowned high standards.

Like many airlines, Air Italy has suffered from the financial effects of the ongoing grounding of the 737 Max aircraft.

Air Italy has engaged a variety of airlines to operate its remaining flights, including Wamos Air, Albastar, Neos, and Tayaran Jet.

O'Brien said Air Italy, which has been placed into liquidation, did not have any interesting slots for the Irish budget carrier.

Air Italy started operating in March 2018 after Qatar Airways bought a 49% stake in a predecessor, with the Aga Khan's Alisarda SpA owning 51%.

The decision to wind up the airline was taken at a shareholders meeting on Tuesday and the airline said flights between February 11 to February 25 would be operated by other carriers at previously scheduled times. Therefore, Air Italy tried to focus on flights further afield, including North America, Africa and various destinations in Asia. Primera Air ceased operations in October 2018.

In February 2019, German airline Germania filed for bankruptcy and British airline Flybmi stopped flying.

The Italian government continues to seek investors for Air Italia, which was put into special administration in 2017 and thrown a lifeline via a government bridging loan.

The industry has faced tough times with the outbreak of coronavirus.

Most recently, the fleet consisted of twelve aircraft - four Airbus A330s and eight Boeing 737s, including three Boeing 737 MAX.

Fewer Chinese tourists and a shock to the global economy from a slowdown in China would hit demand for flights.



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