Blue Panorama goes bust, exposing the challenges smaller Italian airlines face

João Machado

Here’s a challenge for you, dear reader: name one current Italian airline that’s not ITA.

Well, unless you’re really into Italian aviation, you likely won’t know any. And it’s not for nothing; what remains of Italian aviation after the pandemic that razed the industry is not really much.

This week, Blue Panorama (that also operates as Luke Air), owned by Gruppo UVET, Italy’s largest travel agency network, notified the Italian Civil Aviation Authority (ENAC) that it was temporarily halting its commercial activities.

The measure was first announced by a number of local unions, and then confirmed by ENAC in a press release in its homepage. The suspension, said the regulator, was requested by the airline itself.

On October 22, ENAC says, a proceeding was opened to suspend Blue Panorama’s COA – acronym in Italian for Certificate of Air Operator – and its Air Transport Operating License, «correlated to the request of clarifying regarding shortcomings of financial nature found in the company».

ENAC is thereby suspending both of the airline’s licenses.

According to the website L’agenzia di Viaggi, specialized in Italian tourism, Blue Panorama also filed a bankruptcy process in the Milano Court, envisaging to «preserve the company’s assets and continuity».

Blue Panorama also blames the suspension on the lack of liquidity support by the Italian government. Earlier in the pandemic, the Italian state separated EUR130 million for the three smaller private airlines – Air Dolomiti, Blue Panorama and Neos – but, so far, the money has not been transfered to the carriers.

The airline was slowly transitioning into the Luke Air brand – with two Airbus A330 already in the new colors – but, since the pandemic started, it was much smaller in size; this Summer, it barely operated.

Of the twelve aircraft assigned to Blue Panorama’s fleet by Planespotters.net – of which two A330-200s, one Boeing 737-300, one 737-400 and eight 737-800 – only three were operating last week; an A330 and two 737-800, according to data registered by FlightRadar24.

Flights by Blue Panorama’s fleet this past week.

And of these, only the A330 9H-RTU operated flights with the BV code. The others, 9H-CRI and 9H-GFP, were operating touristic flights from Poland with the AMQ code, which is assigned to the local charter operator AMC Aviation.

A pattern in Italy: large carriers prevail

Although this case might seem isolated, it shows a pattern within the Italian aviation industry: more and more the market is converging towards a field of large players.

This week, it came to the news that Tayaran Jet, which is based in Bulgaria but is a de facto Italian airline, with Sicilian investors, was dropping its continuità territoriale (territorial continuity) contract by which it receive subsidies for routes connecting Trapani, in Sicily, to Ancona, Perugia and Trieste, in the mainland.

https://www.facebook.com/tayaranjet/posts/290063493126976

The airline blames the lack of passengers for the drop out almost two years early.

This effectively means that the airline will no longer operate regular flights; Tayaran Jet tried several routes from Sicily this Summer with its fleet of two 737-300s, none of which succeeded.

One of Tayaran Jet’s 737-300s. Photo: Tayaran Jet

«To make a Boeing 737-300 fly, except for the month of August, with a handful of passengers, is a waste for everyone», said Gianfranco Cincotta, Tayaran Jet’s country manager for Italy, in a Facebook post.

«Money of the Italian state and of the European Union is burned without return, nor for the Territory, nor for the airline, but for the sole advantage of the airport [management] companies. This way it can’t go on. After the effects of the pandemic, the continuità territoriale destinations, chosen in a pre-COVID moment, cannot be sustained economically anymore».

Another small Italian carrier in trouble is EGO Airways. The airline, which started its flights this year with a single Embraer 190, planned to start up with two aircraft of the type, but the first one, I-EGOA, is currently under maintenance works in Naples, while the second one has still not arrived.

The only flights the airline is currently operating, from Forlì to Catania and Palermo, are actually sold and executed by Lumiwings.

EGO plans – and for that matter is selling flights – with its own aircraft from December the 1st, connecting Forlì and Parma to a number of other cities in Italy.

EGO Airways’ expected network on December.

The other small carriers in Italy are Air Dolomiti, which is owned by the Lufthansa Group and therefore has a fairly decent support; Neos, which is a large charter operator; Fly LeOne, which started a month ago operating from Pescara with a single Beech B1900; and Sky Alps, which is the sole operator in Bolzano Airport, starting flights this year with a Q400.

The weaker Winter season will likely be once another challenge for these airlines.

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