Downfall of Air Malta

Air Malta struggled financially since its creation in 1973 ultimately leading to its demise.^[2] Before its closure, Air Malta was reportedly facing a loss of €30 million.^[3] European Union regulations preclude companies from receiving state aid more than once within 10-year periods.^[4] The chronically loss-making company had last received a state aid injection in 2012 and was again requesting aid in 2021 following the effects of the coronavirus pandemic.^[5][6]

In August 2022, the government announced it would dissolve Air Malta should the European Union deny further financial state aid to the airline. It would then move its assets to a succeeding carrier.^[7] Shortly after, the decision regarding the airline's future was delayed to the end of 2022; however, the route network and frequencies saw extensive cuts by October 2022, including the termination of several destinations.^[8]

The European Union announced in April 2023 that it would not allow the Maltese government to inject 290 million euros of state aid into the airline.^[9] In October, the government announced that Air Malta would cease operations at the end of March 2024 to be replaced by a new company, KM Malta Airlines, thereby side-stepping EU regulations on state aid.^[1][10]

Launch of KM Air Malta

During a press conference in October 2023, Robert Abela, the prime minister of Malta, stated that the newly recapitalized KM Malta Airlines would retain Air Malta’s current fleet of eight Airbus A320 aircraft, even though the European Union initially wanted a reduction. Its initial routemap included flights to 17 airports in 15 key European cities from Malta: Amsterdam (AMS), Berlin (BER), Brussels (BRU), Catania (CTA), Dusseldorf (DUS), London (LGW & LHR), Lyon (LYS), Madrid (MAD), Milan (LIN), Munich (MUC), Paris (CDG & ORY), Prague (PRG), Rome (FCO), Vienna (VIE), and Zurich (ZRH).^[11] Air Malta operated to 37 destinations as recently as 2019.^[12]

It was also announced that the new airline will employ approximately 390 employees and will eventually phase out the early retirement schemes of Air Malta within the next four years. Refunds were offered starting November 1, 2023 for those with booked Air Malta flights beyond March 30. Booking for flights with the new airline after March 31 went on sale on December 1 2023. Those who accumulated air miles could be paid starting February 2024.^[1]

While the airline plans to eventually fly under Air Malta branding, the government was unable to fulfill its pledge that it would be able to do so at launch with the procurement process yet to be launched when the airline began flying.^[13] The new airline would be able to rent the Air Malta branding from the government^{[note 1]} after a competitive process so its aircraft could fly under the Air Malta brand and the aircraft livery would continue to incorporate the Maltese Cross.^[14] Malta's finance minister, Clyde Caruana, announced that when the new airline is financially stable and making a profit, the government will begin the process of looking into partially privatizing the airline with the government remaining as majority shareholder.^[3]

On the day KM Malta Airlines launched, Illum reported that applicants for cabin crew positions were no longer required to be fluent in Maltese.^[15] This sparked outrage from the Nationalist Party and other politicians.^[16][17][18] Prime Minister Robert Abela was asked about this controversy during a press conference and stated that he expects cabin crew to speak Maltese that that it would be added as a prerequisite.^[19]

Codeshare agreements

KM Malta Airlines currently has codeshare agreements with the following airlines:

• Air France^[21]
• Austrian Airlines^[22]
• Brussels Airlines^[23]
• KLM^[24]
• Lufthansa^[25]
• Swiss International Air Lines^[26]