Alitalia (AZA, Rome Fiumicino) faces a “tragic” situation as it cannot pay salaries to its employees for April until emergency aid is provided, the chief executive of the troubled airline's successor ITA - Italia Trasporto Aereo (Milan Linate), Fabio Lazzerini, told a meeting of the transport and industry committees in the Chamber of Deputies, the lower house of Italy’s parliament, on April 27.

Its state-owned successor ITA has been scheduled to replace Alitalia by July 1. Still, lengthy negotiations with the European Commission have delayed the launch and risk destroying the project altogether if the summer season opportunities are missed, Lazzerini warned.

Last week, the government was due to approve a further advance of EUR50 million euros (USD60 million) to Alitalia as part of an ongoing list of bailouts for revenues lost during the coronavirus pandemic, Italy’s ANSA news agency reported. Still, the government did not transfer the funds in time for workers to be paid on schedule on April 27.

“The employees are not getting their salaries on time, and this is a tragic situation,” Lazzerini said at the meeting.

The negotiations between Rome and Brussels on how to allow ITA to proceed while complying with European Union antitrust laws are proving tough, reports said, with the commission demanding a clear discontinuity with the past, including shedding many of the flag carrier’s slots at Milan Linate Airport.

ITA is “holding out” in the talks in trying to convince Brussels it needs to retain ownership of Alitalia’s ground handling and maintenance businesses, Lazzerini told the committees.

“We need to start quickly because the market is picking up, and Alitalia’s rivals are acting aggressively, especially the low-cost carriers,” Lazzerini said, referring to a Ryanair plan, announced in March, to offer 100 routes in Italy during the summer.

“We aim to start flying on July 1 with a small number of aircraft that will gradually grow over time,” Lazzerini pleaded, putting the number at 47 passenger aircraft and two or three for cargo transport, according to the newspaper Corriere della Sera.

Besides its talks with the European Commission, ITA has also been negotiating with Lufthansa on one side and Air France-KLM, Delta Air Lines, and Virgin Atlantic on the other about a possible alliance partnership “that is not only European but also transatlantic,” Lazzerini added. The idea is to firstly start with commercial partnerships and later to try to bring foreign carriers into the shareholding of ITA. A decision on an international partner is expected by the end of June, he said.