Alitalia staggers on, but competition grows

摘要

With a successful rights issue and a further round of "state aid", Alitalia's struggle for survival continues into another year. But - at long last - it appears that the troubled flag carrier is starting to face real competition from Italian-based rivals. For a while it looked as if the rights issue would fail, as rising fuel prices devastated the original turnaround plan that was put together while Alitalia survived on a ?400m emergency bridging loan provided by the Italian government. That loan was allowed by the European Commission only on the condition that privatisation was completed by October 8 last year, but with no possibility of meeting that deadline, the Commission extended it to the end of 2005 - although it warned that if this was not met then it would reopen its enquiry into state aid to Alitalia.