Alitalia Files For US Bankruptcy Protection, Preventing JFK Ejection
This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.
Alitalia has received temporary bankruptcy protection from a US court just 24 hours before the airline was due to be ejected from Terminal 1 at New York’s JFK airport, according to a court filing by the airline.
Judge Sean Lane of the US Bankruptcy Court in the Southern District of New York issued a temporary restraining order until at least June 23, allowing Alitalia to continue to operate at JFK and in the US despite its financial condition. The beleaguered flag carrier of Italy began bankruptcy procedures in its home country last month after its unions rejected a €2 billion recapitalization plan that would have resulted in pay cuts and layoffs.
According to FlightGlobal, Alitalia said in its Chapter 15 US bankruptcy filing that the operator of JFK’s Terminal 1 had informed the airline that its lease and contract at the airport would be terminated on June 13 due to a failure to pay its bills. The carrier’s US telephone and internet provider had also given notice of its intention to cut off service as of June 20 if its invoices remained unpaid. The restraining order issued by the court prevents both actions from taking place for the time being.
The carrier noted in its filing that its operations at JFK Airport were vital to its finances, stating that 15% of its global revenues are generated from its operations to and from New York and 30% of its overall revenues from its nine flights to and from the US. That’s an impressive amount considering the entire airline serves just under 100 destinations, albeit many of them smaller cities throughout Europe. Alitalia is a member of the SkyTeam alliance, which includes US carrier Delta along with Air France, KLM, Korean Air and others.
Chapter 15 of the US bankruptcy code provides protection for foreign entities operating in the United States — Alitalia currently has 36 employees in the US. The next hearing in the case is scheduled for June 26. In the meantime, if you’re holding tickets on Alitalia, you should be safe in the short term, though it may not be a good choice for longer range planning.
H/T: Live and Let’s Fly
Featured image courtesy of ANDREAS SOLARO/AFP/Getty Images.
Welcome to The Points Guy!
WELCOME OFFER: 80,000 Points
TPG'S BONUS VALUATION*: $1,650
CARD HIGHLIGHTS: 2X points on all travel and dining, points transferrable to over a dozen travel partners
*Bonus value is an estimated value calculated by TPG and not the card issuer. View our latest valuations here.
- Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,000 when you redeem through Chase Ultimate Rewards®. Plus earn up to $50 in statement credits towards grocery store purchases within your first year of account opening.
- Earn 2X points on dining including eligible delivery services, takeout and dining out and travel. Plus, earn 1 point per dollar spent on all other purchases.
- Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,000 toward travel.
- With Pay Yourself Back℠, your points are worth 25% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories.
- Get unlimited deliveries with a $0 delivery fee and reduced service fees on eligible orders over $12 for a minimum of one year with DashPass, DoorDash's subscription service. Activate by 12/31/21.
- Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
- Get up to $60 back on an eligible Peloton Digital or All-Access Membership through 12/31/2021, and get full access to their workout library through the Peloton app, including cardio, running, strength, yoga, and more. Take classes using a phone, tablet, or TV. No fitness equipment is required.