23 July 2008

Malev's Dilemma - same as everyone else's

Malev is axing its two long haul routes to Toronto Pearson and New York JFK.

So this is a good indicator of the dilemma of the marginal carriers. It is actually a good example of how the network carrier model is broken.

For Malev to make money it would need to charge an increment over its fares last year of approx $2000 in C class and about $500 in Y class to cover just the increase in direct fuel costs alone. Malev has 2 767s - a -300 and a -200. Remember it probably has to rotate one out for one day a week for a B check and then hire in a replacement when they go for C and D checks.

Not sustainable.

So Malev - wise decision.



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