Cablegate: Italian Investors Ready to Finance Italo-American

VZCZCXRO8334
PP RUEHAG RUEHDF RUEHIK RUEHLZ RUEHROV
DE RUEHMIL #0329 3201232
ZNR UUUUU ZZH
P 161232Z NOV 07
FM AMCONSUL MILAN
TO RUEHC/SECSTATE WASHDC PRIORITY 1369
INFO RUCNMEM/EU MEMBER STATES COLLECTIVE
RUEHRO/AMEMBASSY ROME 8249
RUEHFL/AMCONSUL FLORENCE 0147
RUEHNP/AMCONSUL NAPLES 0144
RHMCSUU/FAA NATIONAL HQ WASHINGTON DC
RHEHNSC/NSC WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEHBS/USEU BRUSSELS

UNCLAS MILAN 000329

SIPDIS

SENSITIVE
SIPDIS

STATE FOR EUR/WE, EB/TRA/OTP, EB/TRA/AN, EB/TRA DAS BYERLY

E.O. 12958: N/A
TAGS: EAIR ECON ETRD IT KPRV

SUBJECT: ITALIAN INVESTORS READY TO FINANCE ITALO-AMERICAN
AIRLINE

REF: A. 06 ROME 3330

B. MILAN 0273

1. (SBU) Roberto Formigoni, President of Lombardy Region,
told the CG that Italian investors are on board to finance a
new airline as a joint venture with an American carrier. He
promised the Italians will put up the cash if the Americans
put up the expertise. Formigoni is keen to replace Alitalia
flights cut from Malpensa (see ref B), and hopes a fifty-one
percent Italian-owned company run by a reputable American
carrier is the answer. The Region intends Malpensa to remain
an intercontinental hub and not a regional European airport.
So far, only short-haul airlines such as RyanAir, EasyJet,
and Volare have expressed interest in Alitalia's
soon-to-be-vacant slots at Malpensa. The Lombardy Region is
also in talks with Lufthansa to increase its intercontinental
flights. (Comment: Post questions whether Lufthansa would
add anything other than feeder flights at Malpensa given
their massive, nearby hub in Munich. End comment.)

2. (SBU) Roberto Cattaneo, Lombardy Region Commissioner for
Transportation called for American airlines to increase their
service to and from Malpensa at a Post-hosted discussion with
Continental, US Airways and American Airlines. Cattaneo
quickly ran through an economic analysis of Malpensa's
current and projected future traffic and explained
infrastructure enhancement projects planned for the airport.
The US airlines were noncommittal, noting it will be hard to
convince their headquarters to expand service at Malpensa.

3. (SBU) Comment: Formigoni is seriously worried about the
future of a post-Alitalia Malpensa. Post believes the Region
is still working hard behind the scenes to get Alitalia to
reconsider their flight cuts, but they are actively looking
for other solutions. Formigoni's offer to connect an
American airline with Italian financiers for a joint venuture
is a serious one, and Formigoni would put his considerable
political clout behind such a venture if an American carrier
were interested. End comment.
WEYGANDT

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