September 14, 2008

Alitalia May Cut Flights to Pay Bills

The Italian airline Alitalia may be forced to cut back on its flights so it can save money to pay its bills, officials said.

The airline, known for flying the pope, has been losing more than $1.5 million a day, The Sunday Telegraph reported.

In addition to owing on outstanding fuel bills, the airline owes companies that supply in-flight meals and hotels where its pilots and crew stay during stopovers.

Administrator Augusto Fantozzi has been brought in try and save the airline.

He has said that in order to save Alitalia, jobs must cut and costs reduced, but labor unions have refused. Pilots, for instance, are balking at modifications to their contracts, which are considered some of the most lucrative. Alitalia pilots work about 500 hours a year, about 100 fewer than pilots at Lufthansa and Air France, the newspaper reported.

Italian Prime Minister Silvio Berlusconi, a right-of-center tycoon-turned-politician, has blamed the airline's financial woes on "left-wing unions." He has said he would personally be very upset if Alitalia collapsed.

The prime minister reportedly has called on Welfare Minister Maurizio Sacconi and Transportation Minister Aletro Matteoli to help mediate between the unions and the consortium of airlines interested in taking over the beleaguered carrier.