Targeting Italy, Ryanair worries about funding for new national carrier
Ryanair CEO Eddie Wilson has expressed frustration with authorities pumping money into the Italian airline industry amid continued financial difficulties with Alitalia. The executive even shared that he was not afraid to act when necessary.
Last month, we reported that the European Commission had granted an additional € 12.8 million ($ 15.5 million) in public funding to ailing Alitalia following three previous rounds of aid. This money comes at a time when authorities are trying to transfer the national carrier of assets from Italy to a new national airline – ITA.
Amid this continued support, Ryanair management is not a fan of the series of cash injections. The low-cost company has a strong presence across Europe and Italy is one of its key markets. The carrier flies to nearly 30 destinations in the country, and Milan-Bergamo is one of the busiest airports in its network, serving around 80 destinations from there.
Wilson raised concerns about Alitalia and its restructuring, as reported by the Republic:
“Look, I have the impression that there is nothing really new, that in the end Ita will be the extension of Alitalia. With the usual problems already seen for decades: money drained of resources public funds to pour it into those of a company which today, as in the past, will lose some: when the market and the economy were doing well, Alitalia lost. When the crisis was seen and Covid changed our lives, Alitalia has gotten even worse. ”
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Wilson was asked if Ryanair was interested in any of Alitalia’s assets. He then explained the problems with the new airline having the same slots as its predecessor.
“Well, first of all I tell you that we don’t need any brand: Ryanair is the best, best-known and most profitable brand in this business. The problem with the Linate and Fiumicino slots is that Alitalia cannot take public money by pretending to be a new company with the same slots as the old Alitalia: they must be released to ensure competition between all the companies. aerial.
Overall, Wilson was happy to share that he was considering opening up potential niches. He concludes that the market has changed and that ITA would not have great opportunities due to the strong position of Ryanair and other low cost carriers on short and medium haul routes. He insists that the Italian company focuses on the intercontinental market.
Finally, Wilson was asked what Ryanair would do if more euros were pumped into the new company. The businessman replied that his company “will take our measures”, but expresses that it is clear that this is “illegal aid”, so his company will defend its interests.
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Overall, Ryanair has always been straightforward when it comes to public funding. Last year he challenged the European Commission when it came to helping airlines such as Finnair, SAS, Air France, Lufthansa and KLM. Additionally, the Irish airline has shared its dismay at the TAP Air Portugal bailout.
Ryanair itself has received government guaranteed loans since the rise of the pandemic. Nonetheless, the company has around $ 4 billion in cash reserves. Thus, there should be no problem weathering the storm if the global health crisis continues to shake the industry further.
What do you think of Ryanair’s concerns regarding the financing of Alitalia? What do you think of Eddie Wilson’s feelings? Let us know what you think of the situation in the comments section.