Romania is negotiating with the European Commission the fate of TAROM, after the failure of the restructuring plan: “A patient in intensive therapy”
The national aviation company TAROM has accumulated losses almost continuously for two decades, sold strategic assets and survived exclusively on injections of public money. Now, with a European restructuring plan about to expire and losses of 30 million euros in the first 8 months of last year, TAROM is in an almost hopeless situation.
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Since 2008, TAROM has recorded a profit only once in its current activity. The only year the company made a profit was one in which it sold its Airbus A318 aircraft and slots at Heathrow Airport. The cumulative losses are colossal. In the period 2009-2023 alone, the company reported total net losses of over 2.2 billion lei. The number of employees decreased from 2,486 in 2009 to 1,085 in 2024, and total debts increased from 429 million to 927 million lei in the same period.
The European Commission approved in 2024 a state aid of 95.3 million euros for TAROM, of which the company has so far received 22.5 million euros in the form of capitalization. Meanwhile, according to Economica.net, on August 31, 2025, TAROM reported a loss of 30 million euros against a net profit of 5 million euros foreseen in the restructuring plan, and a negative EBITDA of 9 million euros against a positive EBITDA of 30 million euros expected. The company sent a follow-up letter to the Commission acknowledging the failure to meet the targets, citing low-cost competition, geopolitical tensions, supply chain disruptions and delays in the delivery of new aircraft.
“If we don't make it effective, it will disappear”
TAROM needs firm recovery measures, and the company's current business model is not sustainable, Deputy Prime Minister Oana Gheorghiu said on Wednesday. She specified that the airline operator is in a restructuring process approved by the European Commission, but the plan is not on schedule, and the authorities are also considering alternative scenarios, in case the European Commission does not approve an extension.
“The Tarom company cannot support itself at this moment with the business model it has, with the personnel structure it has. And this is proven by the 10 years in which every Romanian gave money from his own pocket, whether he traveled or not with airplanes, paid money for this company to function. What we must do, and what we must do in all state companies, to intervene before we get there”. declared Oana Gheorghiu.
If the European Commission does not accept the extension of the restructuring plan, the Romanian state can no longer grant state aid to the company. Gheorghiu specified that a solution would be to attract a strategic partner that would come with a sustainable business model, with slots and know-how, and that Romania starts any negotiation with certain conditions, such as keeping the name but also operating certain routes.
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“We want to own a company called TAROM. We want to own a company that serves certain internal routes. These are probably important for Romania. These are the conditions under which Romania can start negotiating with a company that could come here with investments and a business model. I don't want TAROM to close either, and I think no one does. But if we don't make it efficient, it will disappear sooner or later.” stated Oana Gheorghiu.
The trade unionists threaten to sue Oana Gheorghiu
On the other hand, Narcis Pascu, president of the TAROM United Trade Union, rejects the idea that the air operator would face risks generated by technical or liquidity problems. Instead, he accuses Oana Gheorghiu of affecting the company's activity through recent public statements, stating that the union is also analyzing the possibility of initiating a court action against the deputy prime minister.
“There are no cash-flow problems today, we don't know tomorrow, but TAROM can support itself financially if it is left alone by politicians, by political parties. Leave us alone. TAROM can function without any kind of political party command. As long as the parties implement their people in the management of the TAROM company, this commercial company can end up being carried away by the ravine, as Mrs. Gheorghiu says. (…) We analyze, together with a lawyer of union, the possibility to see if we can personally sue Mrs. Oana Gheorghiu, if not the Romanian Government, for these irresponsible statements”, said Narcis Pascu for “Adevărul”.
Asked about the possibility of the Romanian state selling shares in TAROM, Narcis Pascu supports this option, but is skeptical that any investor will be found.
“We agree. Perfectly agree. There is no problem, because this is provided for by European legislation and Romanian legislation. The sale of shares is a matter of normality. Only I ask you: at the moment when the company is attacked from all sides even by the Romanian Government, do you think anyone would come to buy shares in the TAROM company?”, emphasized the leader of the TAROM United Trade Union.
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“Proof that public management does not work”
Economic analyst Adrian Negrescu claims that the failure of the recovery plan is primarily the direct result of a fundamentally wrong strategy.
“At the moment, TAROM is like a patient in critical condition, supported in intensive care by financial infusions from both domestic and European sources. Unfortunately, these capital injections did not lead to a real recovery, and the main problem is that the reorganization program was wrongly conceived from the beginning. Instead of having a strategy to develop and expand services, including in the charter or low-cost area, the company went in the direction of continuous reduction of activity. Important assets were sold, including valuable slots such as Heathrow, and the fleet has been steadily reduced,” explained Adrian Negrescu for “Adevărul”.
The solution, says Negrescu, is not closure, but privatization or finding an investor.
“There is the potential to turn the company into a regional hub in Southeast Europe, similar to how Istanbul managed to position itself as a major connection point between Europe and the East. There will always be investors, but the essential condition is the transparency and coherence of the sale project. It is not only the price that matters, but also confidence in the way the offer is built and in the direction the company is going.”explained Adrian Negrescu.
