“At a time when consumers are facing increasingly higher prices for air travel, it is very important to preserve competition in the sector,” said Margrethe Vestager, the commission’s executive vice president for competition. “We needed to prevent that passengers end up paying more or end up with fewer and lower quality air transport services on certain routes in and out of Italy.”
Lufthansa €325M ITA Air Takeover : Stakeholder Responses
Lufthansa and ITA have not yet responded to requests for comment.
Lufthansa AG announced in May 2023 its plan to invest €325 million in ITA for a 41% stake, with the Italian ministry pledging an additional €250 million. However, the commission issued a statement of objections in March, fearing the loss of ITA’s independence could harm competition in the market.
Market Impact
The commission’s in-depth probe highlighted that the deal might reduce competition on short-haul flights connecting Italy to other European nations and long-haul routes between Italy and destinations like the U.S., Canada, and Japan. Passengers spend over €3 billion annually on these routes, with Lufthansa and ITA currently competing, while other airlines provide insufficient competition.
Lufthansa €325M ITA Air Takeover : Conclusion
The conditional approval of Lufthansa’s €325M ITA Air takeover marks a significant step, subject to stringent compliance to ensure competitive market conditions and prevent higher prices or reduced service quality for consumers.
