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Is the Alitalia airline going out of business?

When Italian airline Alitalia applied for protection from creditors many had assumed that this was the first step towards the rehabilitation of the group. However, reports coming out of Italy suggest that the group is no longer able to guarantee flights from Monday morning as the company is having major difficulty settling outstanding fuel bills and arranging future supplies.

There are also rumours that the group has bills outstanding from hotels around the world where the flight crew stay during stopovers. When you take all of the above into consideration and the fact that the company has been losing more than £1 million a day for over a year, is there really much hope left?

Alitalia should really have gone out of business earlier this year but it received a £300 million bailout loan from the government, a payment which is being investigated by the EU authorities with many rivals claiming that it could be illegal under competition rules. Either way there are major doubts that Alitalia will be able to support itself in the immediate future, something which could see the group down planes and move into administration.

Times are tough in the airline industry and when you see majors such as Alitalia hitting trouble you know it is going to get worse.

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