Alitalia hopes to strengthen ties with Air France by signing agreements on shared services. But the airline's management regards improving its financial position as a higher priority.
Alitalia sources say the airline will soon sign partnership contracts for long-haul routes and an agreement on a cargo joint venture with Air France. It is also believed to be discussing a similar deal with Dutch carrier KLM, with the eventual aim of joining the proposed Air France/KLM share-swap arrangement.
However, Francesco Mengozzi, Alitalia's managing director, says the priority is to improve Alitalia's financial situation. He predicts that, without deep cost cuts, losses could reach €350 million ($386 million) in 2003 and €300 million in 2004. Alitalia made €128 million before tax in 2002, but warned that it was unlikely to break even this year.
Mengozzi says the new business plan should increase productivity 15-20% by 2006. Measures include more outsourcing, a significant increase of flight hours for cockpit and cabin crews, and job cuts. Despite union opposition, internal sources say 1,500-2,000 jobs are likely to go.
Source: Flight International
