In a surprising and somewhat embarrassing move, Air Italy cancelled multiple routes. In the past week they pulled inventory to Delhi, Mumbai, and Chicago. This comes in additional to the cancellation of flights to Bangkok, which we learned about in January. With this move, Air Italy is set to completely pulls out from all Asian markets. Air Italy had plans to operate to 28 destinations in 10 countries, so they are losing around 10% of their destinations.

About a year ago Qatar Airways acquired a 49% stake in Air Italy, which was formerly known as Meridiana. Meridiana was a small airline with few international flights operating out of less desirable Italian airports.

Qatar Airways had big expansion plans for the small airline and started by re-branding as Air Italy and creating a hub in Milan. If some of this sounds familiar, it’s because Etihad had similar ambitions when it acquired a stake in the very mismanaged Italian airline, Alitalia. Qatar Airways leased Air Italy some of its older A330’s, and promised them many 787s (off Qatar’s backlog with Boeing) to further fuel their expansion.

The airline recently announced intentions to fly between Milan (MXP) and Los Angeles (LAX), San Francisco (SFO) and Chicago (ORD). The news caused the major US 3 airlines to throw a fit as they claimed it violated the agreement for middle eastern airlines to not open up new 5th freedom flights, as it created unfair competition. The argument was pretty baseless as Air Italy would have been the only airline to operate non-stop between the 2 destinations.

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Final Flights

  • Air Italy will stop flying to Mumbai as of February 16, 2019
  • Air Italy will stop flying to Delhi as of March 28, 2019
  • Air Italy will stop flying to Bangkok as of March 30, 2019
  • Air Italy will never start flying to Chicago

For reference here, Air Italy started flying to Bangkok back in September, the route will have lasted around 6 months. Flights between Milan (MXP) and India didn’t commence until December and will end within 3 months of service and flights to Chicago were announced in December with an estimated start date of March but they will not happen, embarrassingly, at all.

Analysis

It’s not surprising to see Air Italy struggling, with $2300 round trip business class fares, profitability was not likely to happen. On one hand, I want to give Air Italy/Qatar credit for canceling an unprofitable route quickly. When Etihad was running the show at Alitalia, they left the airline with unprofitable routes for a long time.

On the other hand, how can Air Italy/Qatar be so far off when launching a new route? It’s like they are throwing darts at a map and seeing what sticks, and that’s not the best way to run an airline.

I am curious to see what their next move is. Part of me thinks we will see another slew of 3 or 4 half thought out destinations, but maybe, just maybe they have learned their lesson.

What do you make of Air Italy/Qatar’s decision?

Feature image via Wikipedia Commons Simone Previdi

 

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