The power of a brand is one of the most difficult things to quantify in any business, and every company deciding to undergo a rebranding exercise always does it with a good dose of circumspection and fear. When the Italian flag carrier Alitalia decided to “retire” its brand in October 2021 as part of the salvage/takeover operation by Lufthansa there wasn’t much of a choice: operational discontinuity between the old and the new was a paramount need to get the approval from the European Commission so that the Italian Government could provide enough funds to convince the German carrier to take over the troubled Italian airline.
So the new ITA Airways brand was created, and the Alitalia brand, valued at 90 million Euros ($100.5m) during the liquidation procedure of the “old company,” was maintained by the new property and kept on ice.
The Alitalia brand will appear next to ITA Airways as “ITA, inspired by Alitalia,” the new official tagline of the company. The new combination of the two brands, which will now appear side by side, will be visible by the end of 2024 at some strategic touchpoints and will symbolize “Alitalia’s pioneering excellence in air transportation and its role as an extraordinary ambassador of Made in Italy in the world,” said ITA Airways Executive Chairman Antonino Turicchi.
The first half of the year saw a total turnover of 1.4 billion Euros ($1.56b) with a positive EBITDA (Earnings Before Interests, Taxes, Depreciation, Amortization) of 62 million Euros ($69.2m) against a negative EBITDA of 68 million Euros ($76m) for the first six months of 2023. The net operating loss is 140 million Euros ($156m), “but 50% of this loss is due to the unfavorable exchange rate between the Euro and the U.S. dollar,” said Chief Financial Officer Claudio Faggiani.
The airline expects to complete the partial takeover by Lufthansa, which is scheduled to purchase a controlling 41% stake in Alitalia for 325 million Euros ($363m) on November 4, according to Turicchi.
