I suppose it all depends on what you want from a nationalised airline. A grossly inefficient dinosaur that covers all bases, or "Marginal Air" that flies to places that are not commercially viable.
Now the first option is a bit of a non starter, not least because every time you wanted to borrow a bit of cash to buy a new bit of kit, the Treasury would have to give the OK and carry that on the PSBR. And the Treasury hates to say yes.
If you want to run "Marginal Air" why own the company that does it? you get into all sorts of hassles owning a company, having to pay staff, fund pensions, and then you leave office and the incoming party flogs it off. Much easier to just say " We have determined that it advatangeous for the country to have an air service between Mutchington Gromly and The Isle of Macdonald, as this a non profitable route a subsidy will be offered for this route, tenders in by next Saturday teatime"