Italy’s flagship airline Alitalia, have said they will formally request to enter bankruptcy proceedings.
Last month, Alitalia’s directors met to discuss the outcome of a staff vote which concluded with employees voting against proposed redundancies and salary cuts.
It is the second time in a decade that the airline has entered administration proceedings. It is likely that this latest one will lead to its sale or liquidation, marking a collapse for Alitalia.
In 2014, Etihad, the Abu Dhabi based airline, bought a 49% stake in the Italian airline for $2.4bn. The aim was to tap into the lucrative European market whilst increasing the Etihad network to over 400 destinations worldwide.
However, due to the rising competition from European low cost carriers, Alitalia have not been able to fully recover. The carrier lost almost €3bn since it emerged from bankruptcy in 2009.
Sources have said that the company is losing approximately €1m a day. Without any financial assistance from the Italian government, the airline risks running out of cash in two weeks.