Malév Hungarian Airlines Benedict Gombocz

Overview • Also called Malév Ltd. (Hungarian: Malév Zrt.) and

did business as Malév Hungarian Airlines (Hungarian: Magyar Légiközlekedési Vállalat, abbreviated Malév; pronounced MAH-lev).

• Flag carrier and main airline of Hungary from 1946-2012.

• Had its main office in Budapest; its main operating base was Budapest Liszt Ferenc International Airport.

• From there, it offered flights to 50 cities in 34 countries worldwide with a fleet of 22 aircraft.

• Member of the Oneworld alliance in its last years, having joined 29 March 2007.

• Ended operations on 3 February 2012 after suffering from financial collapse.

• Declared bankrupt and ordered liquidated by the Metropolitan Court of Budapest on 14 February 2012.

Beginnings • Hungarian civil aviation was established by airlines

like Aero Rt. (founded 1910), Magyar Æeroforgalmi Rt. (MAEFORT) and Magyar Légiforgalmi Rt. (Malert).

• The prevalent damage of World War II made these airlines terminate service; they were eventually replaced by Malév as the national airline subsequent to the war.

• Founded 29 March 1946 as the Hungarian-Soviet Civil Air Transport Joint Stock Company (Magyar-Szovjet Légiforgalmi Rt.; also known as Maszlovlet).

• The original fleet had 21-seat Li-2 passenger aircraft (Soviet-licensed DC-3) and 3-seat Po-2 “taxis”, used for precision air mail: bags of mail were dropped from the aircraft when flying over its destination.

• Malév moved its operating base from Budaörs to the recently opened airport at Ferihegy, where it stayed.

Beginnings (cont.)• Hungary purchased all the Soviet shares of Maszovlet

on 25 November 1954, and Malév was born.• In the late 1950s, Ilyushin Il-14 twin piston-engined

transport aircraft were obtained.• Operations were expanded; flights extended to

neighboring countries and across Europe and the Middle East after the 1965 acquirement of Ilyushin Il-18 turbine propeller airlines, and the subsequent 1968 purchase of jet-powered Tupolev Tu-134s from the Soviet Union.

• Even prior to the political reforms of 1989 and the subsequent birth of the Third Republic, Malév started retiring its Soviet-era aircraft with the introduction of its first western designed aircraft, a Boeing 737-200, on 18 November 1988; with that, Malév was among the first airlines in the then-communist nations in Central Europe to operate a western-built aircraft (LOT – Polish Airlines was the second with its Boeing 767-300 aircraft launched in April 1989).

• The airline’s logo, which was its second and last logo, was designed by graphic designer László Zsótér (DLA) in 1986; it was consecutively implemented throughout the following years.

1990s-2007: Modernisation • In 2001, the last Soviet-built Tupolev Tu-154 aircraft

was withdrawn from service.• Malév started replacing its Boeing 737 traditional

aircraft with 737 Next-Generation planes in 2003; subsequently managed a fleet of 18 Boeing 737 Next Generations, as well as four Bombardier Dash 8 Q-400s for short-haul routes.

• Hungarian State Privatization Company ÁPV Rt. (Állami Privatizációs és Vagyonkezelő Rt.) owned 99.5% of Malév shares from 1999-2007; other 0.5% were in the hands of small investors.

• ÁPV Rt. repeatedly tried to privatise Malév, and finally sold it to AirBridge Zrt.

Malév Tupolev Tu-154 (new)

2007-2011: In private hands • In February 2007, 99.9% of the airline was obtained by AirBridge,

which had 1,785 staff members as of 31 December 2007.

• In spite of an offer from Czech Airlines to sponsor Malév as an associate member of the SkyTeam alliance and Malév’s codeshare agreements with a number of SkyTeam members, Malév became a member of Oneworld in March 2007.

• Lloyd Paxton was appointed Malév’s CEO on 12 July 2007; he replaced János Gönci, who stayed on the board of directors as an advisor.

• Mr. Paxton was with Oneworld alliance member British Airways for more than 35 years and more recently with Air Astana; he was the first Malév CEO to come from the airline industry.

• Only two months later (14 September 2007), Paxton stepped down as CEO of Malév; Péter Leonov took his place.

• Ballo Anatoly Borisovich became the chairman in January 2009.

• On 18 March 2009, the Russian state-owned Vneshekonombank claimed a minority stake of 49% in AirBridge Zrt., holding the shares of the struggling airline; the majority of 51% stayed in Hungarian ownership.

• Aeroflot, Russia’s flag carrier, took over managing control.

• Martin Gauss, former CEO of DBA and Cirrus Airlines and a Boeing 737 pilot, was voted CEO on 15 April 2009.

• Under Martin Gauss’ management, Malév reached a load factor exceeding industry average among “traditional” airlines, equivalent to that of low cost airlines.

• One reason Gauss resigned as CEO of Malév was the benefit ceiling implemented in 2010 by the right-wing government of PM Viktor Orbán; a ceiling of €8,000 gross salary (roughly €5,000 net) was set for all supervisors and governing state-owned companies.

• In February 2010, the airline was renationalised; the Hungarian government state holding company MNV obtained a 95% stake in the airline, with the remaining 5% saying with AirBridge.

• The European Commission launched an investigation into the unlawful government funding of Malév in December 2010.

2012: Financial collapse and end of operations

• On 9 January 2012, the European Union declared the state aid that Malév obtained illegal and ordered Hungary to recover from the company.

• The European Commission ordered Malév to pay back various forms of state aid obtained between 2007 and 2010, which totaled 38 billion forints (€130 m; 171 m; £108 m), a sum equal to its whole 2010 income.

• Late in January 2012, Malév declared that it was no longer able to finance its own operations, and asked for more subsidies from the Hungarian government.

• Alas, Malév ended its 66 years of operations as Hungary’s flag carrier on 3 February 2012; in the wake of the shutdown, the airline’s total debts were 60 billion forints (US$270.5 million).

• The shutdown took effect at 6:00 am Western European Time on 3 February 2012. • Malév Ltd. was declared bankrupt by the Metropolitan Court of Budapest on 14 February 2012.• Hitelintézeti Felszámoló Nonprofit Kft. (Credit Institutional Liquidator Nonprofit Ltd.) received the appointment as

Malév Ltd.’s liquidator.

Codeshare agreements • Oneworld members aside, Malév Hungarian

Airlines had codeshare agreements with the following airlines: ▫ Aeroflot (SkyTeam)▫ Air Baltic▫ Air France (SkyTeam)▫ Alitalia (SkyTeam)▫ Bulgaria Air▫ Carpatair▫ Czech Airlines (SkyTeam)

▫ Eithad Airways▫ Hainan Airways▫ Moldavian Airlines▫ Rossiya Airlines▫ Syrian Air

Malév in Oneworld livery

Malév Fokker 70, Budapest Liszt Ferenc International Airport

Malév 737-800, Amsterdam Airport Schiphol

Malév Il-18 on display at Budapest Airport Aviation Museum

Malév Tupolev Tu-154 on display at Budapest Airport Aviation Museum

Malév Tupolev Tu-154 (new) on display at Budapest Airport Aviation Museum

The End • Malév Hungarian Airlines tribute:

▫ http://www.youtube.com/watch?v=WGvc_Ai-Rb8

• Malév ad: ▫ http://www.youtube.com/watch?v=xPgZ87eL

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