The closure of the Hungarian flag-carrier, Malev, this morning had, like that of Spanair last Friday, long been predicted by Inside Traveller. Even so, it is still a sad event. The airline was never particularly good and needed radical restructuring and much better customer service if it was to have any chance. The best hope is that the Hungarian government can now come up with a new “Hungarian Airlines” to take over the good parts – in much the same way that Swiss was created from the ashes of Swissiar.
Meanwhile, we note that the Gatwick Airport website remains silent on the matter. On the list of this evening’s arrivals, they merely show “enquire airline” next to the Malev flight from Budapest. Is it asking too much to expect the airport to offer some sort of information on its home page?
The Irish bookmaker, Paddy Power, are well known for their rather unusual speciality bets and, for a couple of years now, they have been running a book on the next airline to close due to financial failure. Globespan was always high on the list but in the last few weeks the price dived. There is no “hot favourite” on their list at the moment but the leaders are Wizzair at 4/1, Finnair at 9/2 and Malev at 5/1.
We would not suggest using their prices as a guide to the strength of an airline because their market-makers seem to have some very strange ideas.
Finnair is 55%-owned by the Finnish government and is regarded as a national asset which is vital to the independence of the country. Whilst it has had a recent dispute with its pilots and needs to improve its figures, its results over the last few years have been better than many other airlines. It is hard to imagine the Finnish government allowing a semi-state company and strategic asset to go bankrupt.
Wizzair is a privately-owned company (in fact, it is run as a group of individual companies which operate from the different bases of the airline). The company has been very secretive about its finances though it appears that the original part of the airline is just about profitable whilst some of the newer subsidiaries are loss-making. This is hardly a suprise so, on the face of it, they appear healthy enough but until they are much more open about their finances, rumours will persist. They might well be in much better shape than is generally thought but, equally, their sudden demise would not be a major shock.
There is a definite question-mark over Malev but some of that is due to the behaviour of its Russian shareholders. The company was bought by a Russian company which went bankrupt leaving the airline partially under the control of a Russian bank. The Hungarian government has been giving the airline a helping hand but they would very much like to find a new and secure home for the airline. It seems unlikely that the Hungarian government would just walk away, especially since the airline itself appears to be getting closer to some form of recovery, but it is not impossible.
Most of the other quotes on the list are laughable but 8/1 for the small Irish regional airline Aer Arann appears tempting. A small, regional airline in a country with an economy in dire straits is, on paper, a very likely candidate for financial trouble, however well-managed it might be. The problem is, we can’t see an Irish bookmaker making a mistake on an Irish airline…
Earlier this month the ether was abuzz with the news that “MALEV adds two new cities in Slovakia“. This caught my eye because I have a hazy memory of the two small countries of Hungary and Slovakia being huddled together with just the Danube between them. Surely an air service between the two countries would be somewhat superfluous? After all, you can get from Bratislava to Budapest in less than two hours by hydrofoil.
Well, closer inspection reveals that Malev’s new services are NOT by AIR but by BUS. This is not a new phenomenon. Back in the 80s Lufthansa forged an agreement with German Railways to provide dedicated rail services between several cities, and more recently SAS’s timetable included a Malmo-Copenhagen service run by ferry. But all the same, it’s nice to see Malev trumpeting the launch of four-times daily services from Budapest to both Bratislava and Kosice, all for the cost of the hire of a small fleet of coaches.
The Hungarian flag-carrier seems to have gone round in a big circle. After the fall of Communism, Malev replaced its Russian-built aircraft with Boeings. The airline was part-privatised and, after some years of losses, ended up in the hands of Russian financial organisations. The Russians are anxious to re-invigorate their aircraft manufacturing industry and have launched a rival to the smaller Boeing 737s and the Airbus A319, the Sukhoi Superjet. Selling this aircraft abroad is going to be a challenge in the current market, especially bearing in mind western consumer resistance to Russian aircraft. Poor old Malev has announced that it has decided to (or been told to) replace its entire fleet with the Superjet, with deliveries beginning in 2011.