Air Malta is dead, long live KM Malta Airlines? The Maltese government has outlined its plans to replace Air Malta with a new flag carrier next spring.
Air Malta Will Be Replaced By KM Malta Airlines DBA Air Malta
State-owned Air Malta has struggled financially for years and fallen behind Malta Air, a budget carrier partially owned by Ryanair that is now the largest carrier to the island nation. Unable to meet its debt obligations, the Maltese government wanted to inject hundreds of millions of Euros into the carrier, but the European Commission vetoed the plan on competitive grounds.
In reality, the government will proceed anyway by shutting down Air Malta, forming a new company called KM Malta Airlines, utilizing the same fleet and employees, and calling the new airline Air Malta…
Earlier today the government outlined its vision for a new flag carrier of Malta, promising to slash unprofitable routes and reach profitability in two years.
Let’s go over some key details.
The new Air Malta will fly to 17 destinations, including:
- Amsterdam (AMS)
- Berlin (BER)
- Brussels (BRU)
- Catania (CTA)
- Dusseldorf (DUS)
- London Heathrow (LHR)
- London Gatwick (LGW)
- Lyon (LYS)
- Madrid (MAD)
- Milan (MXP)
- Munich (MUC)
- Paris (CDG)
- Prague (PRG)
- Rome (FCO)
- Vienna (VIE)
- Zurich (ZRH)
Air Malta also plans to add service to Copenhagen (CPH), a route that SAS suspended during the pandemic and has not resumed.
Air Malta will discontinue service to six destinations, including:
- Geneva (GVA)
- Lisbon (LIS)
- Naples (NAP)
- Nice (NCE)
- Palermo (PMO)
- Tel Aviv (TLV)
In terms of its fleet, all eight Airbus A320 aircraft will be retained (contrary to the wishes of the European Commission). The government will spend €300 million on buying three of the A320 aircraft it currently leases.
Passengers might not notice much of a difference in terms of branding, as the government intends to “rent” the Air Malta brand and maintain current logos and aircraft liveries.
Existing workers will be rehired, but government officials were not clear whether they would need to accept a reduction in wages (a government minister said that wages would be “according to the international market”). Early retirement will be offered for existing workers and the new airline is not expected to offer a defined benefit retirement plan.
All bookings for flights on Air Malta for travel on or after March 31, 2024 will be cancelled and Air Malta will refund customers the full cost (including taxes) of any tickets already issued with travel dates on or after 31 March 2024. Tickets for the new Malta Airlines will go on sale on December 1, 2023.
The Flypass Loyalty Program of Air Malta will be closed and will not be transferred to the new airline.
Quite frankly, it does not sound like much will be changing at the beleaguered state carrier…
CONCLUSION
Air Malta will cease operations on March 30, 2024 and a new company, KM Malta Airlines, will begin operations are Air Malta on March 31, 2024. The carrier will trim its route network and promises to be leaner and reach profitability in two years, but it is not clear to me the business model is changing much at all.
Replacing ‘Air Malta’ with ‘Malta Air’ seems like a slick way to escape any debt accrued by the former . Perhaps only in a Malta court would such a plan work .
Malta Air is the competition!
@PM … Thank you for the heads-up . I am a little dense .
Well, yes and no. The article says that Malta Air is “a budget carrier partially owned by Ryanair”. The other owner is, apparently, the Government of Malta! I cannot find which entity owns what % of Malta Air, though, but I expect RYR is the majority shareholder.
This is a paper transaction like a business declaring bankruptcy, but continuing on in business via reorganization.
The biggest issue is KM Malta Airlines is its still a GOVERNMENT owned flag carrier. Therefore, the employees have a government mindset! Might be better if sold as a subsidiary to Lufthansa, or Air France/KLM, or someone else.
This seems like a re-run of Alitalia/ITA.
That said, I think island nations have different needs to large countries which are well connected to the outside world. This same thing happened years back with Cyprus, Cyprus Airways was also a basket case airline that was forced out by the European Commission and the economy of Cyprus took quite a hit.
It looked for a while as though Aegean would step in but they didn’t, only upping services to Athens and while a few other destinations were offered, it hasn’t been sustained. Cyprus is now served by a patchwork of airlines, none of which has the economy of Cyprus among its considerations.
I think the government of Malta have done something wiser here and I hope it works.
Various entities have tried – and failed – to set up a Canarian airline to serve tourist origins, but the islands have been heaving this summer without any local competition.
We are booked to travel from Rome to Malta in May, When can we book on the “new airline”???
Not yet. It isn’t clear exactly when.