Alitalia pulls out of partnership with Air France-KLM

Tie-up between carriers “no longer strategically beneficial”
Alitalia says it is ending its partnership with Air France-KLM. The tie-up between the European carriers is due to come up for renewal in 2017, but the Italian flag carrier’s chief executive, Silvano Cassano, said it was no longer “strategically or commercially beneficial” to its ongoing turnaround plan.
The airlines have signed a variety of agreements regarding ancillary joint ventures, sales, markets and cargo services, as well as a bond over transatlantic flights.
Euronews says the announcement comes as little surprise to industry insiders as it follows Alitalia’s recent controversial deal with Etihad Airlines. In January, Etihad bought a 49% stake in the loss-making airline in a deal worth €560 million, giving the Gulf carrier a strategic foothold in the European market.
Silvano Cassano: “These agreements [with Air France-KLM] are no longer beneficial, either commercially or strategically, to the new Alitalia and its ambitious turnaround plan. They were negotiated when Alitalia was in a very different position, with the result that the agreements in their current forms favour the other party. They are undermining our ability to restructure our network and the airline effectively to achieve the long-term sustainability of our business.
“The new Alitalia is in a new position. Our business needs agreements which deliver equitable value to each party. For Italy and for Alitalia, our first priority is to win back the inbound tourism market, while better serving Italian leisure and business travellers.”


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