Market Commentary | Energy stocks the biggest losers of the day
‘No breakeven for Air Malta in 2014’ – pilots’ union boss
ALPA president Dominic Azzopardi says ‘clique’ preventing Air Malta from shedding unfair third-party contracts and commissions.
8 August 2012, 12:00am
But the unrelenting critic of the national airline's restructuring process claims Air Malta will not even achieve the breakeven it is hoping to get in 2014, unless it increases cargo prices and renegotiates its contracts with third parties.
"I've seen nothing positive so far - I've seen experienced people leave Air Malta, and more part-timers being introduced to the workforce," Azzopardi said.
Air Malta posted a loss of €30 million this year, after having received the European Commission's green light for a restructuring plan in which the airline must become profitable after receiving €130 million in state aid.
"Unless things change... there definitely won't be any breakeven in the near future," Azzopardi said on Favourite Channel's Reporter.
Pilots and Air Malta's management remain at loggerheads over the restructuring of the national airline - recently the airline said pilots wanted an increase in their annual salaries, while pilots say they are right in demanding an increase after having frozen their salaries for three years in a bid to assist the airline restructuring.
"[CEO] Peter Davies is only scratching the surface of some of the main issues, such as the cheap cargo prices, or the money we pay to MIA and the commissions we pay the airport on fuel and cargo - which doesn't even pass through MIA but through the old terminal; or the prices for tour operators. Air Malta is still the same: subsidising the tourism industry with the hotels we fill up, and manufacturing with our cheap cargo prices," Azzopardi said.
Azzopardi claimed the national airline needs to renegotiate the cost of its fleet and money it pays out to Malta International Airport to rent the new airline headquarters at the Skyparks business centre, as well as make cargo a central part of its profit-making business.
"In three years' time we have to renegotiate the lease of our fleet. This will be an opportunity for Air Malta to evaluate whether we need to fly bigger aircraft and reduce our flying frequency. Air Malta pays €20 million alone in charges to pass over one flying zone to the other. We even pay the Maltese government these charges."
One of his gripes was the fact that Air Malta has not extended its route network to parts of Africa, where the opportunity may exist of flying larger aircraft as part of a regional hub to the rest of the continent. "We have a golden opportunity to increase our frequency to Libya, and even lease our aircraft and pilots to Libya - we can really cream the market by taking over the transport of merchandise."
But Azzopardi claims his thinking has not been taken on board by Air Malta. "They say their schedule is already committed."
"As pilots we did offer our own ideas to the airline, and we think that some people are earning good money from the services rendered to the airline: the World Aviation Group's call-centre, the software Air Malta uses, the agents who charge commissions to the airlines... all these people have planted their roots firmly, and nobody wants to challenge them.
"There is a clique of people that nobody can stand up to, and they are about to kill the goose that lays the golden eggs," Azzopardi charged.
Azzopardi, whose pilots' union boycotted the recent Air Malta rebranding launch, said the €1.9 million job to Futurebrand should have been given to a Maltese agency. "If we are losing €30 million, I'd say the rebranding certainly was not timely... I expected a public tendering competition for a Maltese operation, not a foreign outfit."
He also poured cold water over the Air Malta livery. "Who books flights just because of the new colours of an airline?"
When it seemed he was referring to Air Malta's management as being incapable of running the airline, Azzopardi said that the airline was losing money on fuel hedging costs. Air Malta chief executive Peter Davies has in the past claimed he saved the airline €3.5 million when he changed the company's fuel-hedging policy. "I know we hedged fuel at the USD110 this year," Azzopardi replied. "Now it's down to USD98, so should we ask Davies for the money back?"
Matthew Vella is editor MaltaToday.com.mt and MaltaToday on Sunday.He joined Mediat...
Court & Police
Updated| Bill to propose legal assistance during p...
Court & Police
Siggiewi man, 37, reported missing, police ask for...
Farsons turnover up 20% in interim 2016, up to €...
Court & Police
Seven years’ jail for attempting to import half-...
Court & Police
Man jailed for 25 years after admitting to stabbin...
Market Commentary | Energy stocks the biggest lose...
Latest Business News
follow us on facebook