Title: Alitalia Joins SkyTeam
1Alitalia Joins SkyTeam
27 July 2001
2Key Points
- Alitalia joins SkyTeam, one of the major global
airline alliances in the world - Strategic bi-lateral commercial partnerships
between Alitalia, Air France and Delta Air Lines - Significant synergies identified
- 27 July 2001 effective date, subject to
regulatory approvals
3Alitalia Joins SkyTeam
- SkyTeam is a worldwide alliance in the airline
industry for passenger and cargo services
primarily - System code-sharing
- Use of common customer standards
- Co-ordinated route development
- Frequent flyer program co-ordination and
integration - IT systems joint future developments
- Definition and implementation of cost saving
opportunities and other benefits
4SkyTeam Partners
Destinations 64 206 61 376 77 107 Countries 7 91 3
8 64 29 53 Daily Departures 337 1,700 134 5,280 40
3 869 Aircraft 69 238 30 601 113 162 Hubs 4 3 1 5
3 2 Passengers Carried (mn) 10.6 42.4 2.4 120.0 2
2.1 26.6 Employees 7,414 64,700 4,135 74,000 18,17
9 23,500
Source Published information
5Market Position vs. Other Alliances
- SkyTeam is the worlds second largest alliance in
terms of passenger share
(1)
RPK (bn) 342.6 487.7 646.8 222.5 116.5 RPK
Share 11.3 16.1 21.3 7.3 3.8 Passengers 204.
8 197.7 314.0 90.3 64.3 Passenger
Share 12.3 11.9 18.9 5.4 3.9 Revenues
(bn) 39.5 50.5 80.6 20.2 17.3
Source Airline Business, 2001 - Year 2000
figures (1) Including Alitalia
6Alitalia-Air France Alliance
- Framework
- Creation of a European multi-hub system based on
Paris Charles De Gaulle, Milan Malpensa and Rome
Fiumicino - Increased co-operation through Joint-ventures
- Long term and far reaching Alliance, minimum
duration 10 years - Passenger Business Agreement
- Full Joint-venture on Italy France bundle from 1
April 2002 - Extensive use of code-sharing on a free-flow
basis - Full reciprocal FFP worldwide
- Product and service alignment, but separate
brands - Jointly define role of respective regional
airlines
7Alitalia-Air France Alliance
- Cargo Business Agreement
- Common network design and sales and marketing
strategy - Increased co-operation through Joint-Ventures
- Other Agreements
- Handling, Maintenance, IT and other business
agreements through Joint-ventures where
appropriate
8Italy-France Bundle
- Full Joint-Venture on Italy-France bundle from 1
April 2002 - Targeting 50/50 capacity sharing in approximately
four years - Alitalia and Air France will share the total net
operating income (EBIT) of the bundle - 60 for AF, 40 for AZ in Year 1
- 55 for AF, 45 for AZ in Year 2
- 50 for AF, 50 for AZ from Year 3 onwards
- Fleet operations principles jointly determined
based on operational optimisation - Sales forces separate and independent, but
policies co-ordinated - Co-operate to organise commercial activities
outside respective home markets
9Alitalia-Delta Air Lines Alliance
- Co-ordination of schedules and operations in
order to maximise connections - Extensive use of code-sharing
- Reciprocal participation in each others FFP
- Proration of Passenger fares
- Co-operation on facilities and passenger handling
- Lounge exchange program
- Common promotion and advertising
- Alitalia, Delta Air Lines, Air France and Czech
Airlines will apply for Antitrust immunity to
deepen the co-operation and achieve a higher
degree of benefits on the transatlantic traffic - Aiming at Anti-trust immunity among Alitalia,
Delta Air Lines, Czech Airlines and Air France by
January 1, 2002
10Economic Benefits
- Estimated synergies (at EBIT level) expected to
materialise from the Alliance with Air France - Euro 130 million by 2003
- Euro 180 million by 2005
- A minimum of US 15/18 million from
Alitalia-Delta Air Lines partnership at EBIT
level in the first year of co-operation with
current network and before any immunisation is
obtained - expected to be higher in the following years
11Conclusions
- Alitalia joins SkyTeam, one of the major global
airline alliances in the world - Strategic bi-lateral commercial partnerships
between Alitalia, Air France and Delta Air Lines - Significant synergies identified
- 27 July 2001 effective date, subject to
regulatory approvals