Updated 10.50am with Air Malta statement

Air Malta's board of directors have denied a report on Times of Malta today that the airline has axed its Frankfurt route to appease Alitalia.

Quoting industry sources, the newspaper reported that the decision taken recently the board to stop flights to Frankfurt from next March was intended to ‘please’ Alitalia and lure it to conclude negotiations on buying a stake in the Maltese airline.

"Air Malta's board of directors rubbished such allegations stating that the report does not make sense particularly since the airline will be increasing frequencies next summer on other key non-Italian connecting hubs of Munich, Amsterdam, Brussels, Vienna and Zurich," the airline statement said.

The board strongly condemned such "sensational reports" stating that route and frequency changes are solely based on commercial considerations and Air Malta deploys its capacity on routes that provide the best possible return on investment.

The board added that aircraft capacity is a finite resource and flight schedules are changed and tweaked every season to take advantage of new opportunities, maximise resources and increase efficiency.

Network decisions for the summer 2017 flight schedule were taken independently of any strategic partnership discussions with Alitalia, it said.

The board added it is a known fact that the Frankfurt route was not performing that well. Frequencies on this route had already been reduced from daily to four weekly last summer, well before any negotiations with Alitalia had started.

'Frankfurt was the price to be paid' - sources

According to sources who spoke to Times of Malta, claims that Air Malta's Frankfurt route was not commercially viable were not correct.

“If you take the Malta-Frankfurt route in isolation, it is true that it is not viable due to direct competition from Lufthansa,” sources said.

“However, some 30 to 40 per cent of Air Malta's traffic on this route was for interconnections to other northern European, Asian and American airports. This made the route commercially viable, not to mention the importance of the national airline having direct links to one of Europe’s main hubs.”

The sources said the real reason Air Malta stopped flights to Frankfurt was Alitalia and the government's wish to push the Italian carrier to buy a stake in Air Malta.

Times of Malta is informed that, as part of the privatisation talks which are still ongoing, Alitalia is insisting that Air Malta uses its network to increase passengers to its hubs in Rome and Milan. The first step of this strategy was a new code-share agreement between Air Malta and Alitalia which came into force, without publicity, at the beginning of this month.

“Frankfurt was the price to be paid by Air Malta to have a codeshare agreement with Alitalia. The Italian carrier is hoping to divert interconnecting traffic that used to go to Frankfurt through Air Malta to its network in Rome and Milan,” the sources insisted.

Frankfurt was the price to be paid by Air Malta to have a code-share agreement with Alitalia

UAE’s Etihad, which holds a majority stake in Alitalia, is trying to maximise its network hubs in Rome and Milan by diverting passengers onto their connecting flights.

When Times of Malta had announced the axing of Air Malta’s direct connection to Frankfurt, concerned tour operators had said the airline told them that that route was no longer profitable.

However, tourism industry operators who have their main markets in Germany have lamented that this latest decision by the national airline will not go down well with their German counterparts.

Meanwhile, although negotiations between the government, Air Malta and Alitalia are still officially ongoing, there is no sign of a conclusion.

According to a memorandum of understanding signed last May, an agreement with Alitalia to buy a 49.9 per cent stake in Malta’s national airline was to be concluded last August.

Since then, the government has refused to give any further details while insisting that talks are still going on.

Meanwhile, Alitalia continues to hit the headlines negatively with reports of Etihad wanting to pull the plug on its investment in the Italian carrier.

Alitalia’s CEO Cramer Ball has said the Italian carrier is currently losing some €500,000 a day.