Subsidies to low-cost airlines will this year increase by €500,000 to reach €16.1 million, according to Malta Tourism Authority estimates.
But top budget airline Ryanair, which will be competing head-on with Air Malta on the Rome route from next winter, will not receive any government support to fly to the Italian capital.
Sources close to the national airline told this newspaper that the recent announcement by the low-cost airline that it would be flying almost daily between Malta and Ciampino from October was not well received by Air Malta’s top management.
Though Air Malta did not want to comment on this recent development, a top airline official told this newspaper “this will give us another big blow on one of our busiest routes.”
The government insisted it has no say on Ryanair’s decision.
“Under EU law, any European airline can fly unhindered to any airport in Europe,” a spokesman for the Tourism Ministry said. “Ryanair were not in any way obliged to seek any permission from the Maltese government and from MTA. The same happened when for example Vueling – a Spanish low-cost airline – started flying to Rome a couple of years ago,” the spokesman explained.
The ministry would not reveal how much in subsidies the government is paying to Ryanair on other routes, but said MTA enters into marketing agreements with various airlines to promote more flying in new or “underserved” routes. Rome does not fit in this category.
Local airline sources said that although the government could not stop Ryanair from competing on the Rome route, it still carried a lot of weight when negotiating with low-cost airlines.
“It is a known fact that the government subsidises low-cost airlines on many routes by paying some €20 per passenger to Malta either in kind or through marketing agreements. This gives the government a lot of bargaining power. It’s give-and-take normally and until now Rome was always a no-go area for Ryanair.”
Ryanair confirmed it has been eyeing the Italian capital from Malta for a long time.
“We have been wishing to operate the Malta-Rome route for a number of years,” a company spokesman said.
Pointing out that Ryanair expects to carry 100,000 passengers per year on the Rome route, the spokesman said it did not hold any discussions with the Maltese government before its decision.
Asked how much in subsidies the Irish airline received from the Maltese government and on which routes, the spokesman declined to comment: “All Ryanair commercial agreements are confidential.”
Likewise, when asked which low-cost airlines had benefited from government support last year, a government spokesman said: “These agreements have an element of commercial sensitivity and confidentiality.”
The introduction of low-cost airlines has boosted Malta’s tourism figures to record highs but are often blamed for Air Malta’s woes.