Struggling carrier Alitalia has been granted a €400 million funds by Italy in a bid to rescue the airline from financial collapse - which it has flirted with for many years.
A political source has told Reuters that Alitalia is expected to run out of money by the end of the year, with 11,600 jobs at risk if the carrier does suffer financial demise.
The loan is pending the approval of the European Commission (EC).
Alitalia is crucial to Italy's tourism industry, which accounts for 13% of the country’s Gross Domestic Product (GDP), according to data presented by The Italian Government Tourist Board (ENIT).
Alitalia was put into special administration following a failed restructuring attempt and received €900 million from the government to continue its operations.
Earlier this year, Alitalia was granted an extra extension by Italy’s industry ministry to gain a binding bid by 21 November - that deadline came and went without a deal in place.
Potential rescuers were said to include state-owned railway group Ferrovie dello Stato, US carrier Delta Air Lines and infrastructure group Atlantia.
German airline Lufthansa was said to be interested in investing up to €200 million, however, it has since said it was not prepared to invest in the Italian company.
The government plans to launch a new process for the sale of Alitalia to be completed by May 31, 2020, according to a draft decree seen by the source.
The new scheme will give to the three state-appointed administrators the power to reduce the carrier’s workforce and fleet of airplanes, the source added.
Alitalia has already burnt through roughly 9 billion euros in taxpayers' money, industry analysts calculate.