The first time I flew on Malév was in December 1993. An Internet friend living in Stockholm alerted me to a special fare on a direct New York-Budapest flight. Indeed, it was extraordinarily inexpensive but, despite the low fare, the plane was practically empty. Nearby me sat a traveling salesman with samples of his ware. The stewardess who took a fancy to him amiably chatted with him. She was a great deal less attentive to the other passengers. By the way, I made the mistake of talking to her in Hungarian, thinking that after all Malév was a Hungarian airline. It turned out that she knew no Hungarian. If I recall, this particular New York-Budapest flight was a joint venture of Delta and Malév and the two companies shared personnel.
About a year before, in November 1992, the Italian national airline Alitalia and an Italian bank purchased a 35% share in Malév, but this partnership did not last. In December 1997 Hungarian banks repurchased the Italian share so that Malév was owned almost completely by the State Privatization and Property Corporation (ÁPV). However, the state desperately wanted to get rid of Malév because it was a constant financial burden. After many years of trying, ÁPV manged to sell the airline to AirBridge, a Russian company, largely owned by Boris Abramovich. That was in 2007. Two years later a minority stake of AirBridge was acquired by the Russian bank Vnesheconombank and the daily operation of the airline was run by this Russian bank.
The Russian connection didn’t last long either. After three years, in February 2010, the majority (95%) owner of the airline once again became the Hungarian state. Since Malév was in financial straits, the Bajnai government injected 25.36 billion forints into the company only a few months before the national elections. Wizz Air, a competitor, initiated proceedings against the Hungarian government’s financial aid package for Malév, which, they contended, was “illegal state aid” according to European Union rules.
After the elections the Orbán government tackled the Malév problem. Viktor Orbán hoped that the Eastern wind would blow a Chinese investor to Hungary who would purchase Malév. There was a lot of talk but no results. In August 2011 the Hungarian media hinted about an alleged Czech offer for the purchase of Malév. By December Tamás Fellegi mysteriously announced that serious negotiations were underway for the creation of “a new Hungarian national airline with Budapest as its center.”
In January 2012 came the very bad news that the European Commission had determined that the state aid to Malév was indeed illegal and that Malév must pay back all the money it received from the Hungarian government ever since 2003. The amount was a staggering 88 billion forints. Certain bankruptcy was predicted. So, two days later the Hungarian government stepped in and rescued Malév. Shortly before its creditors could salvage what was left of the firm after its payment deadline expired, the government declared Malév “a company of strategic importance.” This provision in Hungary’s bankruptcy regulations allows the state to protect businesses that are endangered but that allegedly serve some great national interest.
By yesterday, in spite of the steps taken to shelter Malév, it looked as if the Hungarian government was preparing the ground for the airline’s bankruptcy. For instance, it issued regulations about the compensation of passengers holding tickets.
And yet the CEO of Malév repeated again that the government is committed to “the existence of a national airline. “I’m becoming suspicious that this “national airline” may not be Malév. Let’s not forget Fellegi’s announcement last December about serious negotiations with certain European investors over “the creation of a new national airline.” What do Viktor Orbán and his canny friends have up their sleeves? Perhaps if that national airline is no longer called Malév, it doesn’t have to pay back the 88 billion forints the airline received from the Hungarian government or its other financial obligations.
It wouldn’t be the first time shrewd businessmen behind Fidesz come up with such innovative solutions. Lajos Simicska and Csaba Schlecht “sold” twenty Fidesz-owned bankrupt companies owing millions and millions of forints to two foreign guest workers in Germany, a Turk and a Croat. Neither man knew anything about the transaction. Their passports were either stolen or borrowed. Fidesz got rid of the companies in part because they owed an incredible amount of back taxes. I wrote about this case on September 8, 2008. In any event, I’m suspicious.
Two days ago Malév was obliged to delay the departure of a plane full of passengers bound for Brussels for an hour and a half. The prime minister was supposed to take that flight, but it seems he was running late. In fact, when he still hadn’t arrived at the airport after an hour and a half, the plane left without him. Viktor Orbán has a history of treating Malév as if it were his private plane company. During his first stint as prime minister he pulled this kind of stunt several times. But if my suspicion is at all well founded, then it really doesn’t matter how much it cost Malév to delay that plane. It will all be forgotten and some fool may actually purchase “a new national airline.”