With only 12 years in service, the young carrier has seen better days. In fact, in the five years preceding the crisis, the company recorded 4 in green and expansion plans were constantly considered. However, the pandemic has severely hit its balance sheet and has therefore resorted to the SEPI, a state-owned industrial holding that manages the €10,000m rescue fund created after the crisis.
This way, the Palma de Mallorca-based company is set to become the latest airline – after Air Nostrum and Wamos Air, among others – to receive some sort of cash injection under high public scrutiny. This injection follows the polemic that originated with Plus Ultra’s €53m intervention back in March, where the little strategic character of the airline was widely questioned.
Despite proving a consistent and viable business model before the crisis (in 2019, it posted a €3.37m profit), its contribution to the Spanish aviation market remains rather subjective.
The total number of passengers that flew out or from Spanish cities in 2019 was 158,000, representing less than 1% of the total national traffic according to Aena, the country’s airport operator. Last year, these figures drastically worsened as the airline recorded only 3,000 travelers with 65 operations, down from 1,323 in 2019.
A great percentage of these operations, on the other hand, is destined to the Italian market, coinciding with the origin of the principal shareholders of the company: a 27% is participated by Kenobi Club Tour Operator SRL, Italy Aviation Service holds a 25%, while Antonio Corrado Spadaccini and Nasreddin Ibrahim hold approximately 12% and 21% respectively.
The latter is also the chief executive of Nasair, an Eritrean carrier that belongs to a UAE-based company called “Nasair Holding FZE,” involved in the 2013 offshore leaks. This information has been reported by the Spanish news portal “eleconomista.es,” adding further controversy to the potential rescue package.
With this being said, the company would remain eligible for the €25m it is demanding. Moreover, a large part of its 203 employees (most of them in temporary lay-off schemes) are based in the Balearic Islands, and the company supports local tourism by bringing lots of Italian travelers during the summer season.
It is also true that many businesspeople doubt the real impact of the airline’s operations in the area as the airline mainly serves intra-Italian routes as well as charter flights to pilgrimage destinations like Lourdes or Mecca.
The fleet, consisting of 5 Boeing 737-800 and a single Boeing 737-400 – all of which are on lease – will not be altered as the carrier renegotiated all its contracts expecting the charter operations to bounce back this year already.
AlbaStar seems to be committed to keeping the airline afloat, but it will have to face the reluctance of the great public that, driven by nationalistic sentiments amid the crisis, won’t easily condone the cash injection over other businesses in the industry that are also suffering and that could as well be more relevant to the country.
The last word will be the government’s, though, whose verdict on Plus Ultra was positive and justified by María Jesús Montero, the current Treasury Minister, as an act of general interest. According to the socialist government, the aviation sector plays an indispensable role in the tourism sector that accounts for more than 12% of the national GDP.
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Source: https://aeronewsx.com/albastar-airlines-requests-e25m-to-spanish-government/?utm_source=rss&utm_medium=rss&utm_campaign=albastar-airlines-requests-e25m-to-spanish-government
