Air Malta to Be Dissolved, New Flag Carrier in the Works

Originally published on Airways

Malta’s flag carrier, Air Malta (KM), will be dissolved by the end of 2023 as the Maltese Government plans to shut down the airline to create a new one, which will be completed by the end of the year. This news comes as the European Commission rejected the Maltese Government’s request to provide the airline with funding as KM has been in a difficult financial situation that has intensified as a result of the pandemic.

Air Malta’s CEO, David Curmi, confirmed that a new national airline would replace KM. In a statement to the Times of Malta, Curmi stated that all employees would be laid off but could apply for new jobs at the new airline. He added that all current employees are entitled to severance payments. KM last received government funding in 2012, but in 2020 the airline ran into financial trouble as a result of the pandemic and has not been able to recover ever since financially. 

Previously, the airline had over 1,000 employees, but in the past few months, the airline has downsized its workforce to just 330 employees in a last-minute attempt to save the airline. KM also outsourced all ground handling services to save capital and continue operations. The transition will be smoother for customers as KM continues operations until the new airline is ready to take over and provide scheduled flights on its booking website. 

This transition is similar to Italian flag carrier Alitalia’s transition to ITA Airways (AZ) in 2021. Moreover, Cumi stated that the European Commission wants Malta to follow the model the Italian Government used when it came to an agreement with the European Commission to dissolve the Italian flag carrier Alitalia and start a new national airline which is now AZ. 

Air Malta currently operates a fleet of eight aircraft comprising four Airbus A320neo jets and four Airbus A320ceo jets. Before the pandemic, the airline served 35 destinations across Europe, the Eastern Mediterranean, and North Africa. 

Malta is also home to Malta Air (AL), which is a subsidiary of low-cost giant Ryanair (FR). The airline was formed in 2019 as a joint venture between FR and the Government of Malta. AL bases a fleet of 737 aircraft at Malta International Airport (MLA).