The kick-off for the countdown of the integration of Blue Panorama Airlines (BPA) and Wind Jet into Alitalia has begun. A few days after the initial Memorandum of Understanding, rumors started to spread on the development of the operation, which will have to sift through the Antitrust Authority.
Meanwhile, here are the facts: two press releases announced that the board of Alitalia “started the process aimed at achieving integration with Blue Panorama and Wind Jet.” The company had, in fact, signed two days earlier a Memorandum of Understanding to allow Alitalia to expand the reach of the Peninsula in particular, putting another notch on the low-cost segment, seen as critical to gaining market share.
Turning to the figures of the integration, through this operation, Alitalia is going to increase by about 20 percent the number of passengers, from 25 to 30 million passengers potential, and increasing the turnover of over half a billion. Also important is the market share on domestic flows that Alitalia is going to inherit: Wind Jet alone, with its operational bases in Catania, Palermo, and Rimini, owns 6.2 percent of the total share. As for the fleet, 24 planes should go to Alitalia: 12 by Wind Jet and another 12 from BPA. A question mark remains over the issue of aircraft ordered by Blue Panorama: on the one hand, the Sukhoi Superjets, for which the vertices of Alitalia in the past had already expressed strong doubts, and the other the Boeing 787 Dreamliner. In the statement issued by Alitalia, potential synergies have been identified that can be created based on the characteristics of individual companies. As for Blue Panorama, these are synergistic and complementary profiles identified for the “product specialization, the network design, and the type of market served,” while on the front of Wind Jet, the closeness in terms of “territorial specialization, network design, and characteristics of the fleet” are emphasized.
“The integration process,” continued the message from of Alitalia, “is consistent with the current consolidation in the aviation sector, nationally and internationally. These processes are aimed at strengthening the industrial dimension of the operators, increasing their competitiveness and developing the ability to address and manage the macroeconomic variables.”
The next stages of the integration process will be the diligence of the two companies and the green light of the respective boards of directors. There has been no mention, at least in this first phase, as to what could be the future of the brands incorporated by Alitalia. A decision could be linked to the Authority’s decisions, which should express their views on integration. The concentration does not seem to overcome the limitations of other examples in Europe, but there are fears in the market.
The acquisition of Wind Jet and Blue Panorama from Alitalia arrives in Parliament
To bring attention to the story, James Terranova, Deputy of the Great South, targeted the marketing strategies and the effects of the operation on the cost of tickets and job creation.
According to a report from various press sources, in response to the Minister for Relations with Parliament, Peter Giarda stated that the National Agency for Civil Aviation (ENAC) “pointed out that, to date, [it] has not yet received any official communication on the matter of the acquisition by the two carriers from Alitalia of both Wind Jet and Blue Panorama.”
He added that ENAC has sent a formal request for clarification to the three carriers interested “in order to launch any initiatives of competence.” Furthermore, with regard to market concentration, Giarda stated that “the project must be notified to the Competition Authority and of the market for the required authorization.”