The Etihad-Alitalia deal, backed by the Italian Government, received EC approval on the basis only o

The New Year 2015 welcomes in a new Alitalia as Alitalia CAI becomes Alitalia SAI on 01-Jan-2015, having completed an ownership blue collar comedy tour change in which Abu Dhabi s Etihad Airways takes a 49% stake, adding to its investments in other European carriers including Aer Lingus , Air Serbia , airberlin and Darwin / Etihad Regional .
But 2015 will also witness a record amount of seats offered between Italy and Gulf hubs as Alitalia and Etihad grow flights to Abu Dhabi under their partnership, while Emirates and Qatar make their own additions. There will be approximately blue collar comedy tour 1,200 more seats a day between blue collar comedy tour Italy and the Gulf in 2015 compared to 2014, for a total of over 5,100 seats a day.
Alitalia and Etihad will add more seats than they have in the past while Emirates and Qatar, so far, will have their highest growth year in Italy since 2012. In the space of four years the Italy-Gulf market will have doubled from 840,000 seats in 2011 to a projected 1.9 million in 2015.
The Etihad-Alitalia deal, backed by the Italian Government, received EC approval on the basis only of having blue collar comedy tour to offer slots on the Rome - Belgrade route, which is only flown by Alitalia and Air Serbia , in which Etihad has also invested. The common shareholding and lack of other airlines on the route raised competitive concerns. This is a relatively minor concession.
There has been a large competitive response to the Alitalia-Etihad deal with all Gulf airlines blue collar comedy tour and Alitalia growing capacity between Italy and the Gulf. Further moves can be expected as the year progresses. There is much at stake for all the players:
(i) Etihad wants to boost its presence in Italy, where previously it has lagged Emirates and Qatar Airways . Etihad entered the Italian market only in 2007, well after Emirates and Qatar. In 2014, it had about the same number of seats from the Gulf to Italy as Emirates had in 2005. Its growth blue collar comedy tour in 2014 was 48% compared to the previous year and so far in 2015 will be 36% compared to the previous year.
(ii) Alitalia will gain from flying to Etihad s Abu Dhabi hub, where Alitalia can then transfer passengers to/from a range of destinations to which it has not previously had convenient offline access. (Etihad will also codeshare on Alitalia s Abu Dhabi flights.) blue collar comedy tour Alitalia s network east of Europe has been thin and essentially confined to limited Japan services despite the demand from India and Korea , to name but two countries. Alitalia was forced to watch as Gulf, Asian and European carriers carried much Italian traffic . Alitalia will add the second largest number of seats (120,000) to the Italy-Gulf market.
(iii) Emirates will account for 58% of the seats between Italy and the Gulf in 2015, according to schedules filed with OAG. It has a strong position to protect but also opportunities to expand with growth blue collar comedy tour in the number of flights from the Gulf/Asia/ Africa into Dubai , where passengers blue collar comedy tour then connect onwards. Maturing of the Qantas relationship will also bring benefits; Melbourne and Sydney are some of the largest connecting destinations for Gulf carriers in Italy. (The Italian Government has previously imposed blue collar comedy tour somewhat bizarre third country codeshare restrictions in this market, limiting the amount of traffic the respective partners, Qantas and Virgin Australia , can ticket on Emirates and Etihad services. It will be interesting to see if these limits are now lifted.)
(iv) Qatar does not want to be become the smallest player. In past years Qatar has been at least twice the size of Etihad in the Italy-Gulf market, blue collar comedy tour but in 2015 the combined size of Alitalia blue collar comedy tour and Etihad will be just under Qatar s size.
At the time of their Aug-2014 partnership announcement, Etihad and Alitalia had flagged blue collar comedy tour Alitalia eventually launching new Abu Dhabi routes to secondary blue collar comedy tour Italian cities blue collar comedy tour like Bologna , Catania and Venice . Alitalia has started that process with a service blue collar comedy tour to Venice. Venice was a natural choice given its far larger size than Bologna or Catania, which have limited international links.
These proportions are similar to the capacity distribution at Emirates and Qatar. Alitalia, which is a newcomer to the market, has a more equal distribution between blue collar comedy tour the markets. With time, additional secondary markets could be launched while it adds more capacity to Milan and Rome. Etihad serves only Milan and Rome and has an equal distribution in 2015, although Rome is still a newer route.
This traffic is coming from and going to a range of points. After their respective home markets, Gulf carriers blue collar comedy tour see a range of destinations, especially at Emirates, which is benefitting from access to Qantas regional blue collar comedy tour Australian market. The markets vary by carrier but there are themes: Australia , Tokyo and Seoul are popular, as are popular leisure destinations like Bangkok , Mahe , Male and Mauritius . Italy is also a popular destination for Chinese, including those in Hangzhou , which is Qatar s 10th largest connecting market and by some measures the wealthiest area in China .
The markets – Middle East , Africa, Asia-Pacific – that Gulf carriers link to Italy over their hubs are a small part of Italy s story. Seats from Italy to Europe and North Africa will comprise about 88% of all international non-stop seats from Italy. But these markets have been under-exploited and hold considerable growth opportunity.
Notably, the Middle East is a larger market from Italy than North America in terms of non-stop flights; Italy has watched helplessly as much of its trans-Atlantic traffic travels over other European hubs.
The growth Gulf carriers blue collar comedy tour are planning so far promises to be net growth and not merely a re-arranging of the pie. Of other non-European and North American carriers serving Italy, blue collar comedy tour the biggest are planning roughly to maintain or grow capacity. China Eastern will be about 5% larger in Italy in 2015 while Cathay will be 6% larger.
Air India will gain a full year s benefit from the growth it put in Italy in 2014. Smaller carriers like Royal Jordanian , MEA , Sri Lankan and Biman will decrease capacity, but they are affected by a range of issues – regional instability, inefficiencies – so that cannot conclusively say Gulf growth is at their expense.
blue collar comedy tour Europe s main airlines, which can transport passengers from Italy to markets the Gulf carriers serve, are publishing mixed forecasts for 2015: Lufthansa will shrink by 3% and Air France by 6%, but British Airways will grow 5% and KLM 2%. But only a small part of that traffic would potentially connect to a market served by a Gulf carrier.
The large growth in the Italy-Gulf market will potentially lead to short-term over-capacity and lower fares, although as it disperses through the wide networks of the respective blue collar comedy tour airlines the outcome is never apparent beforehand.
Factoring in accommodation and local costs (to say nothing of value), a short getaway to Southeast Asia may become blue collar comedy tour cheaper than a trip within Europe. The Gulf-Italy story is also heavily about the Alitalia-Etihad relationship, one many (competitors) find contentious but with which the two newlyweds plan to press ahead.
Alitalia will re-brand (but keep the Alitalia name), could potentially join Etihad s Partners grouping, use its capacity to fly beyond Abu Dhabi to new markets blue collar comedy tour in conjunction with Etihad, to name but a few strategic developments. Meanwhile, part of the spin off to these arrangements is already making itself known as Etihad promotes itself and Alitalia as Official Global Airline Carriers of EXPO Milan 2015 , something the independent Alitalia could never aspire to.
Financially, Alitalia has some big hurdles to leap: it must lower its costs and become competitive with peers. Balancing short-term financial objectives with long-term strategic blue collar comedy tour ones becomes more challenging with so much competition. One upside is that so far airlines from Asia – where most of the additional Italy-Gulf passengers will go to and come from – do not feel compelled to add to the growing competition.
Alitalia's new-found Asia strategy appears to be stimulating competitive responses. Alitalia has announced new services to Seoul, a return to China and expanded services to Japan. More Asian markets could be on their way. After much delay, Korean Air will double its presence in Italy by de-coupling Milan and Rome, served on a triangular routing, and then increasing capacity.
Korean Air has carried 25% of the Korea-Italy market, so it has left much traffic to others, mostly to sixth freedom airlines like Lufthansa and other Europeans. Alitalia part owner Etihad hopes Alitalia's eastwards expansion will allow it to claw back at the gains Lufthansa and other carriers have made in Italy.
Growth from China to Italy looks more organic than competitive. Air China will become blue collar comedy tour the largest airline in the Italy-Asia market while the China-Italy market will welcome a third Chinese player as Hainan Airlines starts twice-weekly Chongqing-Rome service.
Alitalia has announced a new strategy to accompany its newest incarnation, following Etihad Airways' acquisition of a 49% stake in the Italian airline from 1-Jan-2015. The strategy includes the aim to return the company to profit in 2017, after a long period of losses. The five main elements of Alitalia's strategy focus on the network, cooperation with partner airlines, the fleet, "guest services" and the brand.
There will be less direct flying to Africa, blue collar comedy tour a little more to Asia and a lot more to the Middle East to feed Etihad's hub. Alitalia will also increase its operations in the Americas and in Europe, where Etihad's own presence is smaller.
The crucial question that the statement does not address is how Alitalia will go about changing the mindset, developed over many years, that regards perpetual losses blue collar comedy tour as the norm. Even if the necessary cuts can be achieved, such an entrenched culture is not easily redirected. Yet, for Alitalia, this is surely the last throw of the dice.