The island state’s national airline is running a high deficit. That’s why the government has prescribed tough austerity measures that will eliminate half of the jobs and targets. Air Malta is also abandoning its long-haul plans.
In Valetta you wait. The EU Commission will soon decide how much state aid Air Malta can receive. The government of the island nation is aware that it will not be a large amount. Because it may only compensate for the losses that the national airline has demonstrably incurred as a result of the Corona crisis.
Further support measures are not possible. Air Malta last received state aid in 2015. The EU only allows government intervention every ten years, meaning the airline won’t be eligible for support once more until 2026 at the earliest. And even that wouldn’t be safe, since it’s been in the red for years.
Closure of ground handling business
Since 2005, Air Malta has flown losses of 258 million euros. “Every time a plane flew to any destination, that flight meant a loss for the company,” Malta’s Finance Minister Clyde Caruana told the newspaper last week Malta Independent. According to EU rules, however, a company can only be supported if it still has opportunities on the market. Exceptions are only possible due to events that cannot be influenced, such as the pandemic.
In view of the small amount of support, Caruana has announced a tough restructuring, in which the number of employees will be halved from the current 890. Air Malta will close its highly loss-making ground handling business. This will eliminate 300 jobs. A further 110 to 120 jobs are to be lost in administration and cabin crew.
No Airbus A321 XLR for Air Malta
As a result, the airline can save 15 million euros per year. Those affected will be offered new government jobs. That’s not all. The network that once contained 40 targets has been reduced to 20 targets.
In addition Air Malta abandoned the plan, with three Airbus A321 XLR destinations in the US and India head for. Instead, Air Malta will lease three Airbus A320 Neo, Caruana said. The fleet currently consists of seven A320s.