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Malev goes bust!

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Malev goes bust!

Old 5th Feb 2012, 22:10
  #81 (permalink)  
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The hungarians?

Anyway, the rules of the EU, especially those about competition, were already around when hungary joined that club, and thereafter they had a say in any change. And unlike the Euro group there is actually an opt out clause from the EU and hungary is of course more than welcome to use it. Would save the rest of europe a lot of hassle and billions of euros every single year (net amount paid from the EU to hungary in 2009 close to 2,5 billion euro, third biggest amount in the EU).

By the way, nobody is forced to use lufthansa to reach frankfurt, there are other routes outside of the lufthansa network, although they might require a downroute stop, but alas it is possible.
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Old 6th Feb 2012, 08:35
  #82 (permalink)  
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Sad for Malev this is. However the current system in the EU is simply leading to monopolisation of routes. After consolidation of a battle on a route there is only one airline left doing it. Except for exceptional routes like LHR-CDG and other really highh density airports. Those airplanes will always be full regardless of price.

I don't see how government money should EVER end up, in any circumstance, in an airline. So we choose either protectionism, which is fine by me, or we choose a free market, which is also fine by me. But surely we cant have one airline receiving loads of subsidies whilst another airline is being destroyed for receiving subsidies.
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Old 6th Feb 2012, 09:37
  #83 (permalink)  
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It's nice to meet someone whose views are almost as myopic as my own - even if 180 degrees opposite....

Agree with everything you say about 'knew the rules, opt-out', etc....

But...It's the rules themselves, how and by whom they were created, and for what possible benefit were they created, which I find to be so undemocratic as to be crazy bordering on insanity....

Maybe these same EU bullies should consider paying a little more attention to the € zillions of government funding which the new-ish Middle Eastern carriers have received the past 15 years, and stop them operating inside the EU as competitiors to Europe's legacy carriers ??

Oh no, hang on...Most of those € zillions have been spent with Airbus, so that's all right then...

Are / were Malev so seriously a competitive threat to AF/KLM, BA/IB and LH/LX/OS/SN/BM that they should be forcibly shut down for receiving, some years ago, €300 million for breaking so-so rules of an organisation which itself spends € trillions every year handing out subsidies for everything from olive oil production to highway construction to directly and indirectly subsidising other airlines and routes in certain parts of Europe ??

I happen to think not....
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Old 6th Feb 2012, 10:43
  #84 (permalink)  
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Hussar 54

We've had two airlines (Spanair being the other) go in the last week or so both having received so-called "illegal" subsidies.Whatever the rights and wrongs of the subsidies and whether or not they can be compared to regionalised ones given to FR etc,I'm not sure either outfit was actually "closed down by Brussels" as many here are suggesting.
Qatar A/W decided not to pursue Spanair PARTLY in case the "subsidies" were recalled and I think the Hungarian Govt simply felt further possibly "illegal" bailouts to Malev weren't going to turn the ship around.I think scapegoats are being sought for several essentially poorly run operations and I also think there's a national pride syndrome about legacy flag carriers.Personally,I'd have saved PanAm!
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Old 6th Feb 2012, 11:03
  #85 (permalink)  
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I think it's probably only me who's actually used the term - almost everyone else has been far more charitable about Brussels and less so about Malev's own management....

But...Last one, because I'm probably boring everyone by now....For those of you who don't dip into other forums, and entirely coincidental datewise to this thread -

€250 mln in subsidies paid to 15 airlines in 5 years

Seems Ryanair don't receive subsidies after all - as if !!

And presumably something else for the Brussels wallahs to have to investigate - as if !!
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Old 6th Feb 2012, 11:19
  #86 (permalink)  
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I'm not sure either outfit was actually "closed down by Brussels" as many here are suggesting.
Black Kettle, no one has suggested that either Spanair or Malev were shut down by Brussels.

That postulation is like trying to make an argument in an empty room.

What has been not, suggested, but stated is that the EU environment for operators is a farce. Some subsidies are illegal, but others are legal, yet it depends on the manner in which subsidies are driven and leveraged that makes it ok.

Anything else makes the operational envionment a game of 'musical chairs' and leaves a carrier facing the prospect of falling it's backside when the music stops this time around.

What is farcical is that as drfaust pointed out:

we choose either protectionism, which is fine by me, or we choose a free market, which is also fine by me. But surely we cant have one airline receiving loads of subsidies whilst another airline is being destroyed for receiving subsidies.
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Old 6th Feb 2012, 12:24
  #87 (permalink)  
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Last one from me as well,lest we stray too far OT.The term I used was my own,hence the quotes around it.
The post from drfaust makes the point I feel.I agree entirely with his "free market vs protectionism" sentiment but he then implies (IMHO) that these two outfits were penalised by EU bureaucracy for having had the subsidies.I don't believe the evidence supports that.They could,after all have been profitable in the first place.
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Old 6th Feb 2012, 14:17
  #88 (permalink)  
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you are speaking my language. The whole industry is going the wrong way, you are right, this forum is too short to discuss that. Thanks to Ryan/Easy/Wizz etc. the respect and appreciation of flight crew now is the lowest ever. The industry as a whole, is walking down the same road road asWalmart or McDonalds.

Sad thing is that these vulture companies always find desperate guys.
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Old 6th Feb 2012, 21:23
  #89 (permalink)  
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signing on to the EU mean't you signed on to another version of communism. Central control by unelected officials...
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Old 6th Feb 2012, 22:25
  #90 (permalink)  
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the industry

basic economic theory suggests that over time unfettered competition results in the sum of all the entities reaching a zero economic value state, where the average profit plus cost of funds = zero. Some organisations will be above and others below the zero return result.

The changes of rules allows velociraptors to take advantage of opportunities that occur from the change to the playing field, and also from inconsistencies that arise as governments have a unique propensity to arrive at irrational outcomes with even the best of intentions. legacy companies, and those that behave like legacies due to inertia, lack of comprehension, or lack of situational awareness will suffer the "slings and arrows of outrageous fortune", and either survive by reinventing themselves, or can be put on a metaphorical ventilator with State aid. In Europe, with the wonky governance of the EC and also various State players, it is more of a surprise that any industry maintains the ability to compete in an open market. The current direction of the RPT industry is to achieve the most minimal service outcome to the passenger at the short term benefit of relatively low pricing, but any assumption that pricing will remain attractive to the consumer in the long run is unlikely to be realised; the infrastructure of the industry needs to be paid for to be provided, and at present the prior investment has been afforded by legacy airlines and governments that were in a position to invest in the long term. Where the price of parking your car for a day at the airport, or the cost of a cappuccino is higher than the cost of the air ticket, it is hardly likely that the cost if ACMI+F, ramp, handling, security, terminal, landing, air nav etc are being recovered without some effective subsidies, which would even include the inflated value of second hand aircraft, being paid for by legacy carriers trying to reinvent themselves or other wannabes...

The EC is a swamp of B.S. regulations that impede competition, but have anomalous outcomes, such as killing the local carrier who is competing with others that are outside of the reach of the EC, or are smart enough to circumvent the rules of the EC. The retention of Alitalia while Malev collapses is inconsistent, and the EU citizens do suffer the consequences either directly (loss of jobs) or indirectly, (loss of infrastructure).

"if this is not a mess, it will do until a mess comes around..." as far as the RPT industry goes, and the EC regulation appears unable or disinterested in avoiding the collapse of the industry as is being dragged out in the US. OTOH, if you don't mind having pretzels thrown at you and drinking warm Coke, perhaps we are getting the mass transport system we deserve and desire.

My advice to young people wanting to enter the industry, Don't.

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Old 7th Feb 2012, 01:41
  #91 (permalink)  
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The industry as a whole, is walking down the same road road asWalmart or McDonalds.
The international airline product today is nothing but a commodity, nothing more, nothing less! There a few exceptions of airlines who actually differentiate themselves from the competition, but they're few and far between!
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Old 7th Feb 2012, 13:11
  #92 (permalink)  
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The purpose of the EU legislation regarding airlines was precisely to prevent incumbent legacy carriers (i.e. Olympic) from stifling competition legitimate free market start-ups. Thus the marketplace would have more vendors which means more competition and thus lower/flexible fares. The free market.

Unfortunately Adam Smith never saw how global corporations would rise to create behemoth entities which themselves stifle competition and start-ups.

If you want to use the legislation to base the EU for your own ends. Go ahead but you're incorrect.

There are many reasons why the company failed. I think in the end its probably fair to say that the market size just didn't exist for a country of just over 10m people. They tried a LH strategy and a local strategy and even investment from Russians. It will be a great shame to see an airline with such a long history disappear. Maybe Central Europe would have been better served by LOT, CSA and Malev combining in a SAS style operation?
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Old 7th Feb 2012, 13:15
  #93 (permalink)  
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Would certainly have been better looking CC than SAS if they had merged
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Old 7th Feb 2012, 14:30
  #94 (permalink)  
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Establishment of a new Hungarian national carrier

An intensive campaign has been started on Facebook to establish a new Hungarian national carrier to be able to save as much of Malév as possible. During the past three days, already more than 24.000 people liked a page called https://www.facebook.com/malevert
The concept behind the campaign is that if it reaches hundreds of thousands of people, mainstream media will deal with it and we'll be able to re-establish a national carrier with thousands of shareholders.
If you've had pleasant moments on board of a Malev flight or agree with our idea, please support us by clicking on the like button.
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Old 7th Feb 2012, 14:56
  #95 (permalink)  

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This, from Malev's Wiki entry, speaks volumes

On 12 July 2007 Lloyd Paxton was appointed CEO of Malév. Paxton replaced János Gönci, who will remain on the board of directors as an adviser. Mr Paxton was with British Airways for over 35 years and most recently was with Air Astana. Mr Paxton was the first Malév CEO to come from the airline industry. Two months later, on 14 September 2007, Lloyd Paxton resigned as CEO of Malév
Martin Gauss, who came later, was respected and professional but was constantly battling political interference.

There used to be a joke in the airline that the CEO's office was the only one on the management floor which didn't have a name plate.
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Old 9th Feb 2012, 18:47
  #96 (permalink)  
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Hello everyone a fb friend asked me to share this:


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Old 9th Feb 2012, 19:39
  #97 (permalink)  
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Asia is an expanding market. China and India. Sorry to say both low cost attempts in these countries not wholly successful.So I think the future has potential, but while this governments aviation policy is a farce, short term may be tough times
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Old 12th Feb 2012, 16:21
  #98 (permalink)  
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As a humble pax with a flight booking on Malev (albeit in May) my esteemed credit card company tells me they are "still flying" - despite me saying that half the fleet has on average been parked up in Ireland.

This Credit Card company - which has American in it and is not wideley excepted everywhere despite their advertising campaigns tell me to call a Budapest Number which of course no one answers.

Any thoughts what pax are supposed to do on flights booked through ,Malev.com? ;Last time I looked they were telling everyone to contact their credit card company....

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Old 12th Feb 2012, 16:44
  #99 (permalink)  
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nivsey, who did you book through ?

for example if you booked through expedia, you may well be covered under their ATOL (number 5788) other are like wise eg ebookers.com or travelhouse.co.uk..

the CAA, gives this advice..

Direct Booking with an Airline

Airlines are not included within the ATOL Scheme, so if you booked direct with an airline that has ceased trading you will not be covered. If you paid directly to the airline by credit card you might be protected by Section 75 of the Consumer Credit Act 1974. You should check with your card issuer for further advice.
If you booked airline ticket through a travel agent you should speak to the agent. Some travel insurance covers airline insolvency, so if you took out a policy you should check whether this provides cover.
Booked via an ATOL Holder

If you booked flights together with other holiday arrangements with a travel company that holds an ATOL (Air Travel Organiser's Licence), and received an invoice for these from this company, it is responsible for arranging alternative flights for you so that your holiday can continue. If you are abroad, it should make arrangements to bring you home at the end of your trip.
If you have bought just flights from an ATOL travel company and it issued your ticket straightaway, the company may provide airline failure insurance from which you can make a claim. You should contact the ATOL travel company.
Scheduled Airline Failure Insurance

Some airlines, ATOL holders and travel agents will offer customers either a specific Scheduled Airline Failure Insurance (SAFI) policy or include similar protection within a broader travel insurance product. The type of protection provided may vary depending on the type of policy taken out. A policy may cover the cost of the original tickets purchased or the additional cost of purchasing new flights, such as when purchasing new tickets for travel back to the UK.
you can find out more here : Failure of Scheduled Airlines | Air Passenger Rights | Consumer Protection

3 February 2012


On 3 February the Hungarian carrier Malev suspended operations and cancelled all planned flights from that date. More information and contact details for the airline can be found here1.
Passengers who booked through a Travel Agent are advised to contact them in the first instance.
Passengers who booked directly with the airline using a credit or debit card should contact their card issuer.
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Old 12th Feb 2012, 17:15
  #100 (permalink)  
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As for Swissair, they had a horrible crash with their MD-11, I think it was one reason. Malev has a good safety record in comparision.
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