Problems emerged for two Eastern European flag carriers last
week, with Hungary's national airline accepting a 5.7 billion forint (US$26
million) emergency government loan and Czech Airlines (CSA) scrapping five
routes.
Hungary's Malév took the cash from the Hungarian government to repay aircraft
leases to the U.S.-owned International Lease Finance Corp., with reports
claiming the airline was in danger of part of its fleet being repossessed.
Malév was renationalized in February, with 95 percent of the carrier now under
state control.
CSA announced it will axe its routes from Prague to London
Heathrow and Manchester, which means it will no longer fly anywhere in the United
Kingdom. The other three services, also from Prague, to be cut from Oct. 31 are
Munich, Cologne/Bonn and a domestic route to Brno.
CSA said it is reducing its network coverage to concentrate
on building Prague as a hub connecting East with West by 2012. However, it is
noticeable that on two of the routes—Heathrow and Munich—the airline competes
with flag carriers with superior frequencies, and on the other two it faces
stiff competition from low-cost carriers. Selling slots at Heathrow, which is
full, will also give CSA a sizeable cash boost, but will make it very difficult
ever to return.
In addition, CSA announced a reduction in frequency on 12
other European routes, including Stuttgart, Hamburg and Zurich, but said it
will increase service to Belgrade, Brussels, Paris Charles De Gaulle, Athens, Beirut
and St. Petersburg.
Last year, the Czech government abandoned plans to privatize
CSA.