Route adjustments, reinvention plans and new codeshare arrangements couldn’t save Italy’s flag carrier, which filed for administration this week, the second time in less than 10 years.

The application to the Italian government follows a recent staff vote to reject a rescue plan that would have slashed wages and required shareholders to invest a further €2 billion (AU$2.89 billion) in the business, The Guardian reported.

According to reports, a commissioner will be appointed to assess the business and determine the airline’s future, however, Italy’s leaders have already ruled out re-nationalising the airline, which was privatised in 2008 after the airline first applied for bankruptcy.

In an online statement, Alitalia assured travellers that currently flights are operating as scheduled. The carrier’s website also continues to take new bookings and KarryOn has contacted Virgin Australia to see whether the recent move will affect its codeshare arrangement with the European airline.

Etihad Airways, a 49 percent stakeholder in Alitalia, said it was “disappointed” by the loss-making airline’s situation, but stressed that it had done everything it could to support the brand.

“It is clear this business requires fundamental and far-reaching restructuring to survive and grow in future,” Etihad Aviation Group’s President and Chief Executive Office James Hogan said.

“Without the support of all stakeholders for that restructuring, we are not prepared to continue to invest. We therefore support the necessary decision of the Alitalia Board to apply for extraordinary administration.”

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Etihad President & CEO, James Hogan with Alitalia Chairman, Luca Cordero di Montezemolo.

Hogan continued, citing low-cost competition for the airline’s situation as well as weakened tourism demand.

“As a supportive investor, we have delivered on our commitments since taking our minority share,” he added.

“Our investment, alongside the other shareholders, has helped to protect thousands of jobs over the last three years. We would like to thank the other shareholders, and the Italian Government, for their commitment as we have worked together since we took our shareholding.

“Italy remains an important market for us and we will continue to work with Alitalia as a commercial partner alongside our own presence in Italy.”

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