Reviving Alitalia: Italy's Loss Making Airline

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

Case Details:


Case Code : BSTR126 For delivery in electronic format: Rs. 500;
For delivery through courier (within India): Rs. 500 + Rs. 25 for Shipping & Handling Charges


Case Length : 25 Pages
Period : 1995-2004
Organization : Alitalia
Pub Date : 2004
Teaching Note : Not Available
Countries : Europe, Italy
Industry : Airline


The case discusses the problems faced by Italy's government controlled airline company - Alitalia that led to its poor financial performance since the fiscal 2000. It examines the efforts taken by the company's top management to turn around the company and explores why they have been largely unsuccessful. The case details the role played by Italian government in the company's business matters and the poor labor relations in company.

With the leadership change in March 2004, the case identifies the issues faced by the new CEO and its management team. It includes a comprehensive note on the European civil aviation industry with a focus on Italy.


Understand how internal, industry-specific and macroeconomic factors can negatively affect the financial performance of a company


  Page No.
A Loss Making Company 1
Background Note 2
The Problems 3
The New Management 4
Alitalia in the Mid-1990s 5
The Trouble Begins 7
The Government Intervenes 8
Looking Ahead 10
Exhibits 13


Alitalia, European Airline Industry, Airline Industry in Italy, Labor Relations, Corporate Turnarounds, European Commission, Change in Management, Low Cost Airlines, Sky Team Network, Services Mix, Government and Business

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