Malta is well on its way to becoming a major regional hub in the Mediterranean, and direct flights to places like East Asia, New York and Mumbai are now one step closer after Ryanair announced its plans for the island, according to industry experts.
Following the news that the Irish giant would be opening up a subsidiary company called Malta Air on the island, along with a maintenance base, new aircrafts and potentially new routes, Lovin Malta spoke to an international aviation industry insider to understand what this move means for the local industry, and if we were on the cusp of seeing Malta step its aviation game up in a whole new way.
“This development is the biggest single investment since Ryanair itself showed up”
Looking at Malta from a global perspective, it’s not surprising experts are feeling optimistic about the latest move by Ryanair to consolidate its footing on the island.
“Malta’s industry is going to keep on growing – and this deal is Malta’s insurance policy. With Malta Air, Ryanair has skin in the game,” a high-level industry insider told Lovin Malta. “And the official version is pretty much the truth,” they said, in reference to the government’s express sentiment that a major part of this deal was “locking” Ryanair into operating in Malta.
“I think this is incredibly exciting – but I don’t think there was ever any danger of Ryanair leaving Malta, because it’s a very profitable base for Ryanair. Back in 2005 or so, the company started with three routes… now it has a local base, 61 routes, its own aircraft. Ryanair grows so quickly, it grows at the equivalent of one Air Malta every few weeks.”
Ryanair accounts for over one third of passengers that pass through Malta International Airport. However, for the insider, of key importance is the fact that a maintenance base will be set up on the island.
“Ryanair have maintenance bases already, but they’re going to increase their fleet size by 200 aircraft, and that’s not so different than the total number of aircraft of say Lufthansa or British Airways – and all those planes need maintenance,” they said. “Aircraft maintenance is very strong on the island, you’ve got Lufthansa Technik doing a fantastic job, Easyjet’s entire fleet is maintained in Malta, and I’m absolutely ecstatic Ryanair are going to have a maintenance base here now.”
“What Malta did for the maritime industry, it can do for aviation”
There is hope that Malta’s success in creating a strong sea-based industry can be replicated in the air.
“What Malta did for the maritime industry, it can do for aviation – low cost, but high quality, with a highly-regulated register. In 2010 there was the Aviation Act that sort of opened it up, and now finally we are looking at a serious number of aircraft on the register, it is fantastic. There are now 300 or 400 aircraft on the register – and there’s no reason Malta shouldn’t have more.”
“The Ryanair brass have a bit of fondness for Malta”
It’s known that chiefs over at Ryanair headquarters have a soft spot for Malta, but Malta Air signifies more than just a bit of affection – it shows the business potential for the island.
Ryanair has opened other subsidiaries recently, such as in Poland, but the fact that Malta has been chosen as one of the key locations for Ryanair’s first batch of subsidiaries is a “great opportunity’ for the island”.
“My best guess is we could see up to 30 new routes being added by Malta Air over the next three years,” the source said.
And when it came to the announced 350 people who would be employed here, the insider felt that number was “too low”
“There’s already hundreds of people employed in Malta, but they are on the payroll in Dublin. Now, they’ll be on the payroll in Malta. They said 350 people – but I feel that’s on the low side, I would speculate that it’s more around 500 people, based on how Ryanair operates,” they said.
“One 737 requires 35 staff, and you’ll need 50 people in the head office,” they continued, “75 more in the maintenance base… it’s going to get to 500 pretty quickly.. And if you go beyond 10 aircraft, then there’s even more…”
Malta Air vs Air Malta
Following the announcement, some wondered if Ryanair was setting up the company due to tax incentives on the island, or whether Ryanair was planning on buying Air Malta out in the long run.
“Air Malta has a deal where Ryanair sells their tickets on the Ryanair site – and Air Malta gets as many views in a year on their site as Ryanair gets in 30 hours,” they pointed out.
“Ryanair cannot buy Air Malta, end of, the EU commission would stop it, so this co-existence works perfectly well for both, selling tickets through the website, and Air Malta going to airports like Heathrow that Ryanair doesn’t serve,” they said.
And when it came to why Ryanair set up in Malta, the insider sees it in pretty simple terms
“These decisions are made on a business basis – if it makes sense business-wise, then it’s going to happen,” they said.
“Here in Malta, we need to stop putting ourselves down with this talk of ‘they are only coming here for the tax incentives’ – look at iGaming, do you think if the tax incentives go away, 12,000 people are just going to leave? There’s a lot more advantages in being in Malta than just taxes, and Ryanair will want to make a big success of having a branded airline in Malta with sub divisions of their brand represented locally,” they said.
And as far as having Air Malta become the higher end, long-distance airline, the insider feels like that could very well be possible.
“Malta to Mumbai is getting feasible,” they said. “If Air Malta opt for some new aircraft, they still won’t be able to do Beijing or Tokyo, but they can do Accra, Johannesburg, New York… those are just about within range.”
“And there’s certainly demand for an East Asia route, so maybe an Asian airline will be looking at that,” they added. “But we’ll soon be flying these huge distances, and with Malta becoming a hub, Malta will be connected to these huge airports.”
“Malta will be the recipient of these long distance flights, and the island will become a regional hub, so that passengers will go on from Malta to other airports,” they ended. “I mean, Ryanair fly to 13 airports in Italy – if you live in Bari, how else are you going to get to New York as comfortably or conveniently as a new link through Malta?”