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On the #Ita-Lufthansa dossier, the European Commission is awaiting new proposals on cutting routes before taking #a decision which, according to Brussels, may #be #postponed from the deadline of 6 June, probably to the second half of June. Yesterday #a meeting of now between the Minister of Economy, Giancarlo Giorgetti, and the #EU Competition Commissioner Margrethe Vestager, who according to the Mef, was “frank, cordial and constructive”. # Minister Giorgetti underlined “the importance of respecting the timing of the decision by the European Commission to guarantee #a positive future for the Italian airline, its workers and travellers”, but the proposal formulated by Mef and Lufthansa does not seem to satisfy the DG Competition in Brussels.
Sources close to the dossier claim that the negotiations are on #a “positive trajectory”, Ita and Lufthansa are preparing new corrective measures to cut overlapping routes and respond to the concerns raised by Brussels which fears the marriage between the two companies #will put the competition on some connections and in the Milan hub of Linate.
At the center of the negotiation is the Statement of objections notified by the Brussels Competition Directorate last March 25th, to which on April 11th Mef and Lufthansa responded by sending #a series of proposals, the so-called “remedies”, to address the concerns in matter of protection of competition. # For the purchase of 41% of Ita Airways, the German group intends to invest 325 million, but Brussels fears that the marriage between the two companies #will reduce competition, first of all on #a certain number of short-haul routes that connect Italy with the countries of Central Europe. # Considering the network between Ita and Lufthansa which includes Swiss, Austrian Airlines, Brussels Airlines and Eurowings, according to the European Commission it must #be considered that the competitors are low cost carriers such as Ryanair which in many cases operate from more remote airports.
Even on long-haul routes between Italy and the United States, Canada and Japan, Brussels fears that competition #will #be limited because it considers Ita, Lufthansa and its joint venture partners as #a single entity, including the Star Alliance network and the transatlantic joint venture (there are two, with United Airlines and Air Canada respectively) and between Europe and Japan (with All Nippon Airways). # Another reason for the #EU Commission’s concern is that ITA’s dominant position in the Milan Linate airport #will #be “created or strengthened”.
The time factor, however, is important: in 2023 Ita Airways eliminated the loss and closed the year with 450 million in cash, but any postponement of the decision compromises the development of the company because, in addition to blocking the investment, it does not allow to exploit the precious commercial synergies between airlines.
