Abstract

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.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

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

Keywords

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