Air Malta trying to extend Italy foothold
Air Malta is keeping a watchful eye on plum Italian routes which may be vacated by Italian national airline Alitalia. Politicians and trade union leaders are trying to secure the backing of pilots and cabin crew for a new Italian airline, salvaged from the wreckage of Alitalia, which is teetering on the brink of liquidation. With Alitalia’s fate still hanging in the balance, the carrier has already abandoned its dual-hub strategy and has significantly reduced its presence in Malpensa, where the Maltese carrier would relish a greater foothold. Without losing our identity as Malta’s flag bearer, we will be reacting immediately when presented with new opportunities Air Malta’s chief executive officer Joe Cappello told www.di-ve.com that the Maltese airline was closely monitoring the situation. With the high fuel costs, the ‘under two hour flight market’ has increased its importance. This means that for Air Malta, the focus should be on Italy. “Fiumicino is crucial for Air Malta, which has been operating up to 3 flights daily there. On the other hand, in Malpensa, although we already have a good presence with a daily flight in summer, Air Malta is ready to fill any vacuum and is ready to take advantage of any favourable circumstance which might arise,” he explained. Exploiting the freedoms acquired as a result of EU membership, Air Malta is already using Reggio Calabria to pick up traffic for Rome and Catania. Air Malta will be adding an extra Airbus to the current fleet of 11 aircraft. Mr Cappello said the airline would try to use the extra capacity to scale up its activity in Italy. “Without losing our identity as Malta’s flag bearer and our obligations to serve as a gateway for tourists to come to Malta, we will be reacting immediately when presented with new opportunities as we have done in similar occasions in the past,” he explained. “The situation of Alitalia is still very fluid but we are still in time to take advantage of it for next summer since the Italian market is a late booking one,” he added. The Air Malta CEO ruled out any chance of acquiring a minority stake in Alitalia. “Minority shareholders never wield control. For example, Swiss Air used to have a minority shareholding in a number of airlines but could never influence the decision-making process,” Mr Cappello explained. However, Air Malta is keeping a close eye on the ongoing Franco-German tussle over stakes in the Italian carrier which could influence the Maltese airline’s current agreements in the Star Alliance. “Currently, Air Malta has code-share agreements with Lufthansa and Air One. If the German airline took a stake in the Italian carrier, it would strengthen the Star Alliance,” Mr Cappello said. The airline industry is operating in a cut-throat environment. A combination of unprecedented oil prices, economic slowdown and weaker confidence has forced at least 25 airlines out of the industry so far this year. IATA (International Air Transport Association), in a doom and gloom forecast, predicted that only British Airways, Lufthansa, Air France and Ryanair would survive the credit crunch in Europe. “No, we are not going to close down if this is what you are asking. Fortunately, we operate in a niche market and we will survive this situation,” Mr Cappello said. He agreed that the airline industry was mired in its “worst ever” trading conditions, even worse than the woes following the catastrophic events of September 11. “We are still in our early days as the airline’s financial year closes in March but we are facing a number of negative factors,” Mr Cappello said. Fuel costs hammered the flag carrier’s peak season in summer. “Our bottom line was dented since 30 per cent of our total passengers fly during the height of the summer season which means that the bulk of this year’s flying took place when the price of fuel was at its peak,” he explained. Moreover, the weakening sterling knocked revenues from the UK routes by another 20 per cent, he added. by Paul Cachia - pcachia@di-ve.com Local News -- 19 November 2008 -- 10:45CEST
Air Malta is keeping a watchful eye on plum Italian routes which may be vacated by Italian national airline Alitalia. Politicians and trade union leaders are trying to secure the backing of pilots and cabin crew for a new Italian airline, salvaged from the wreckage of Alitalia, which is teetering on the brink of liquidation. With Alitalia’s fate still hanging in the balance, the carrier has already abandoned its dual-hub strategy and has significantly reduced its presence in Malpensa, where the Maltese carrier would relish a greater foothold. Without losing our identity as Malta’s flag bearer, we will be reacting immediately when presented with new opportunities Air Malta’s chief executive officer Joe Cappello told www.di-ve.com that the Maltese airline was closely monitoring the situation. With the high fuel costs, the ‘under two hour flight market’ has increased its importance. This means that for Air Malta, the focus should be on Italy. “Fiumicino is crucial for Air Malta, which has been operating up to 3 flights daily there. On the other hand, in Malpensa, although we already have a good presence with a daily flight in summer, Air Malta is ready to fill any vacuum and is ready to take advantage of any favourable circumstance which might arise,” he explained. Exploiting the freedoms acquired as a result of EU membership, Air Malta is already using Reggio Calabria to pick up traffic for Rome and Catania. Air Malta will be adding an extra Airbus to the current fleet of 11 aircraft. Mr Cappello said the airline would try to use the extra capacity to scale up its activity in Italy. “Without losing our identity as Malta’s flag bearer and our obligations to serve as a gateway for tourists to come to Malta, we will be reacting immediately when presented with new opportunities as we have done in similar occasions in the past,” he explained. “The situation of Alitalia is still very fluid but we are still in time to take advantage of it for next summer since the Italian market is a late booking one,” he added. The Air Malta CEO ruled out any chance of acquiring a minority stake in Alitalia. “Minority shareholders never wield control. For example, Swiss Air used to have a minority shareholding in a number of airlines but could never influence the decision-making process,” Mr Cappello explained. However, Air Malta is keeping a close eye on the ongoing Franco-German tussle over stakes in the Italian carrier which could influence the Maltese airline’s current agreements in the Star Alliance. “Currently, Air Malta has code-share agreements with Lufthansa and Air One. If the German airline took a stake in the Italian carrier, it would strengthen the Star Alliance,” Mr Cappello said. The airline industry is operating in a cut-throat environment. A combination of unprecedented oil prices, economic slowdown and weaker confidence has forced at least 25 airlines out of the industry so far this year. IATA (International Air Transport Association), in a doom and gloom forecast, predicted that only British Airways, Lufthansa, Air France and Ryanair would survive the credit crunch in Europe. “No, we are not going to close down if this is what you are asking. Fortunately, we operate in a niche market and we will survive this situation,” Mr Cappello said. He agreed that the airline industry was mired in its “worst ever” trading conditions, even worse than the woes following the catastrophic events of September 11. “We are still in our early days as the airline’s financial year closes in March but we are facing a number of negative factors,” Mr Cappello said. Fuel costs hammered the flag carrier’s peak season in summer. “Our bottom line was dented since 30 per cent of our total passengers fly during the height of the summer season which means that the bulk of this year’s flying took place when the price of fuel was at its peak,” he explained. Moreover, the weakening sterling knocked revenues from the UK routes by another 20 per cent, he added. by Paul Cachia - pcachia@di-ve.com Local News -- 19 November 2008 -- 10:45CEST