Air Malta to resist raising fares

The chairman of Air Malta yesterday said the airline would do its utmost to keep fares low and resist the increases necessitated by the sharp rise in costs resulting mainly from the war in Iraq.

Louis Grech said Air Malta needed to come up with innovative offers and possibly relax its booking rules in order to stimulate jaded demand.

Mr Grech was speaking at the inauguration of the 10th edition of Amitex, Air Malta's International Travel Exhibition being held at the Trade Fair Grounds in Naxxar.

The airline, he said, had managed to overturn the negative travel trend prompted by the September 11 attacks by taking action to stimulate demand, primarily through advertising, promotion and pricing.

Unfortunately, the pre-Christmas period had been characterised by the rumblings of an impending war in Iraq, and this was followed by a long period of uncertainty as to whether or not hostilities would break out.

During this limbo period, people were reluctant to commit themselves by placing firm bookings backed up with deposits - an essential element for the positive cash flow that is so relied upon by the tourism industry, especially the incoming one.

The war had an impact on the airline's market segments to varying degrees, Mr Grech said.

The UK market was the worst struck, but the situation was similar, although perhaps less pronounced, in the Italian and Dutch markets. Germany and France were less badly affected.

It was still early days however, and Air Malta would have to see how the war was going to develop.

Mr Grech said the Maltese outgoing market had been slow this year, what with the referendum, the upcoming election and the outbreak of war. "Hopefully the Gulf war will come to an end soon so that we may save some of the summer season."

In the past year, International Air Transport Association (IATA) member airlines sustained a loss of circa $13 billion following a loss of $18 billion in the preceding year.

These losses had wiped out the cumulative profits of the last 45 years.

Paradoxically, in the midst of this chaotic situation, or because of it, Air Malta had embarked upon and concluded some of the biggest projects in its 30 year history, Mr Grech said.

He said the airline might introduce a new image for Air Malta, including a corporate brand, aircraft livery and colour scheme, and enhanced products. Some alternatives would soon be available on the Air Malta website for public viewing.

The modernisation of the fleet and the radical enhancement of its information technology infrastructure would enable the airline to continue to research its clients' demands, Mr Grech said.

Next year, the chairman said, Air Malta planned to accelerate the process of divestment of non-core activities which would allow it to focus its resources fully on aviation business.

"With the solid background that we have established we can look to an uncertain and changing future with cautious optimism.

"We have weathered several storms in the past, and the dedication and professionalism of most of our staff has enabled us to emerge stronger from each adversity."

Economic Services Minister Josef Bonnici, who also spoke at the opening, said EU membership would provide Air Malta with considerable additional operational flexibility.

It would give Air Malta the capability that it has long desired to fly to any destination within the EU.

At present, Air Malta can only fly to a limited number of specified destinations covered within the air service agreements that the government has laboriously managed to conclude with the individual countries involved.

Upon membership, it would be possible for Air Malta to take passengers from one European city to another.

Prof. Bonnici too referred to the war in Iraq, saying it had cast another dark shadow on the travel industry.

Hopefully, it would only be a passing one. But it showed, once again, how the travel business and tourism would always remain very sensitive to factors outside of their control, Prof. Bonnici said.

Participation for this year's Amitex edition will be one of the strongest so far, with 39 local and 42 foreign exhibitors taking part.

As in previous editions, Amitex will be displaying a wide range of travel-related services, offering the general public a comprehensive array of opportunities under one roof to plan holiday and travel requirements.

The national airline is also marking Amitex with a set of timed special fares to a number of its destinations.

For just Lm75 plus taxes one can fly to and from London Stansted, Athens, Casablanca, Cairo, Istanbul, Larnaca and Sofia. Another special fare of Lm90 plus taxes is being made available to and from Amsterdam and Vienna, during specific periods.

Tonight, the exhibition will host Lynn Chircop, who will be representing Malta at this year's Eurovision Song Contest.

The main sponsors of this year's edition of Amitex are Airbus Industrie, Carlsberg, Maltacom and Go Mobile.