SFGate: N. Italy Officials Unite Vs. Air France

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Sunday, December 23, 2007 (AP)
N. Italy Officials Unite Vs. Air France
By COLLEEN BARRY, AP Business Writer


   (12-23) 12:07 PST MILAN, Italy (AP) --

   Officials in northern Italy are uniting in opposition to Air France-KLM's
bid for ailing Alitalia SpA, which would make Rome the nation's only hub
at the expense of Milan.

   The Air France plan — which the Alitalia board tipped Friday as its
preferred bidder over Italian airline Air One SpA — would do away
with Alitalia's two-hub system, one at Rome's Leonardo da Vinci airport
and the other at Milan's Malpensa.

   Having a hub in Milan has been fiercely defended by northern politicians,
but has been criticized as too expensive and impractical. Alitalia's
board, under chairman Maurizio Prato, has already signaled its intention
to cut traffic to Malpensa.

   The Northern League — a party with a strong regional identity
— has threatened strikes and blockades in opposition to the Air
France bid.

   David Boni, a northern League official, said the Air France-KLM plan wou=
ld
"put out of the game the only hub that could compete on an international
level," while costing the north jobs, the news agency ANSA reported
Sunday.

   Lombardy regional president Roberto Formigoni called the board's decision
"unacceptable," but noted that the ultimate choice of a preferred bidder
for the government's 49.9 percent stake will be made by Prime Minister
Romano Prodi's government next month.

   He urged Rome not to "hide behind the board's decision," saying it "risks
playing with fire ... if it abandons the most important territory in the
country."

   Guglielmo Epifani, leader of the CGIL labor confederation, came out Sund=
ay
against the Alitalia board's choice, citing the failure to guarantee
Malpensa's future or to lay out plans for Alitalia's domestic routes.

   "These are the problems that require a national operator to confront,"
Epifani said, according to ANSA. "That isn't simply a matter of the
nationality of the company, but rather to have a response to these
concerns."

   Under Air France's plan, Rome's Leonardo da Vinci airport would be
integrated into the Air France-KLM hub network as the primary airport for
travelers to and from Italy, and would serve as a gateway to southern and
eastern Europe and northern Africa, the Alitalia board statement Friday
said.

   "The new group, thanks to the presence of a hub in southern Europe, will
improve its position with respect to its European competitors," the
statement said.

   Air France "foresees an important role" for Milan's two airports, with
Linate, located in Milan, focused on business travelers while Malpensa
would retain its three principal intercontinental connections to North
America, South America and Asia, the statement said.

   Rome's Leonardo da Vinci had 30.1 million passengers in 2006, while
Malpensa had 21.8 million, according to the Airports Council
International. Air France-KLM's other hubs, Paris' Charles De Gaulle and
Amsterdam's Schipol, had 56.8 million and 46 million, respectively.

   The government has been trying to off-load the loss-making Alitalia since
last December. ------------------------------------------------------------=
----------
Copyright 2007 AP

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