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Airlines

Name: MALEV HUNGARIAN AIRLINES
7JetSet7 Code: HGA
Status: Currently Not Operational
Region: EUROPE
City: BUDAPEST
Country: HUNGARY
Employees 2600
Web: malev.com
Email: info@malev.com
Telephone: +36 1 235 3535
Fax: +36(1 235 3330
Sita: BUDDCMA
Background
(definitions)

Click below for data links:
HGA-2001-03-A
HGA-2001-03-B
HGA-2001-03-C
HGA-2003-01 RPK STATS
HGA-2004-04 STM MEMBER
HGA-2004-07 737-8Q8
HGA-2004-07 NEW EU MEMBER
HGA-2005-01 2004 TRAFFIC
HGA-2005-11 NO PRIVATIZATION
HGA-2007-05 ONEWORLD ASSIST
HGA-2007-STATS
HGA-2011-04-A
HGA-2011-04-B
HGA-2011-04-C
HGA-2011-04-D
HGA-2011-04-E
HGA-2011-04-F
HGA-2011-04-G
HGA-2011-04-H
HGA-2011-04-I
HGA-AIRPORT BUD AD
HGA-LOGO
HGA-MAP
HGA-VISIT BUDAPEST-1
HGA-VISIT BUDAPEST-2 - MAP CITY

FOUNDED IN 1946. MALEV HUNGARIAN AIRLINES (HGA) STARTED OPERATIONS IN 1947. IT IS THE NATIONAL FLAG CARRIER. REGIONAL & INTERNATIONAL, SCHEDULED & CHARTER, PASSENGER & CARGO, JET AIRPLANE SERVICES.

ADDRESS:
KONYVES KALMAN KRT 12-14
1367 PF. 122
BUDAPEST, H-1097 HUNGARY

Hungary was established in 1001, covers an area of 93,033 sq km, its population is 10.6 million, its capital city is Budapest, and its official language is Hungarian.

JANUARY 1995: 1994 = -$6.7 MILLION (NET LOSS): +16% PASSENGERS (PAX), +40% (FTK) FREIGHT TRAFFIC.

4,588 EMPLOYEES (INCLUDING 1,880 FLIGHT CREW (FC)).

PLANS TO PHASE OUT TU-154 BEGINNING OF 1995 & TU-134 WITH F 70'S IN 1995 - 1996 WINTER.

AUGUST 1995: INCDT: A MALEV HUNGARIAN AIRLINES (HGA) 737-3Q8 (26303) SANK BACK ON RUNWAY (SUSPECTED WIND SHEAR) AFTER GEAR RETRACTED & UNKNOWN TO FLIGHT CREW, THE TAIL & ENGINES STRUCK THE GROUND. THE AIRPLANE HAD PRESSURIZATION PROBLEMS, BUT LANDED OK AT BUDAPEST, = 6 (FC)-(CA)/79 PASSENGERS WERE OK.

DECEMBER 1995: 1ST F 70 (TAY 620-15), (ILF) LEASED (OF 3) (ALREADY HAS 3 +1 ORDER FROM FOKKER).

APRIL 1996: 50TH YEAR ANNIVERSARY!

JULY 1996: 1ST 6 MONTHS = +22% PASSENGERS (PAX), +40% FREIGHT TRAFFIC (FTK).

NEW ROUTE TO BANGKOK.

AEROPLEX (APX) CONTRACT FOR AEROSVIT (UKA) ENGINEERING & MAINTENANCE FOR 737-200'S.

+2 F 70'S, EX-AIR LITTORAL.

SEPTEMBER 1996: MALEV HUNGARIAN AIRLINES (HGA) HAS A NEW AIR CARGO BASE IN BRUSSELS.

AEROPLEX IS THE 1ST MAINTENANCE FACILITY IN CENTRAL EUROPE TO BE CERTIFIED BY BOTH THE (JAA) (JAR-145) & THE (FAA) (FAA-145). THE HUNGARIAN (CAA) IS A CANDIDATE MEMBER OF THE (JAA), AND WAS ACCEPTED BY KLAUS KOPLIN, SECRETARY GENERAL OF THE (JAA), THE NETHERLANDS. 2 YEARS TO GO FOR FULL MEMBERSHIP.

OCTOBER 1996: MALEV HUNGARIAN AIRLINES (HGA) HAS A LOW OPINION OF (GE) ENGINE SUPPORT, SINCE THE REPRESENTATIVES HAVE NOT VISITED IN THE LAST 3 YEARS, DUE TO BUDGET CONSTRAINTS.

(HGA) IS STUDYING "BASIC - REQUIRED NAVIGATION (RNAV)" (JAA) REQUIREMENTS FOR 1998 ON 6 737-200'S.

+2 F 70'S (MARCH 1997), AIR LITTORAL, MONTPELIER, FRANCE.

DECEMBER 1996: AEROPLEX HAS MAINTENANCE CONTRACT "C" CHECKS FOR 2 LITHUANIAN AIRLINES (LIJ) 737-200'S (1ST PK632), EX-DELTA AIRLINES (DAL).

FEBRUARY 1997: MALEV HUNGARIAN AIRLINES (HGA) HAS $6 MILLION PLANS FOR 140,000 SQ FT CARGO TERMINAL AT FERIHEGY INTERNATIONAL AIRPORT (BUD), BUDAPEST FOR COMPLETION IN NOVEMBER 1998.

APRIL 1997: ALITALIA (ALI) OWNS 35% ($77 MILLION), GOVERNMENT 51%.

FISCAL YEAR (FY) 1996 = +$2.3 MILLION (NET PROFIT).

JUNE 1997: FISCAL YEAR (FY) 1996 = +$3 MILLION: +21% PASSENGERS (PAX), +11% (ASK) CAPACITY, 57% LF LOAD FACTOR (+3.0).

MALEV (HGA) IS TO BUY BACK (ALI)'S 35%. (ALI) PAID $77 MILLION IN 1992.

JULY 1997: MIHALY HIDEG, CHIEF ENGINEER TO LEAVE AIRLINE.

SEPTEMBER 1997: FLOYD GERING, ADVISOR TO MANAGING DIRECTOR & FORMER DIRECTOR QUALITY ASSURANCE & ENGINEERING, AEROPLEX, HAS LEFT TO JOIN (GAMECO), GUANGZHOU, TO SET UP NEW MAINTENANCE BASE IN WUHAN. HE HELPED AEROPLEX GET (FAA) & (JAA) PART 145 CERTIFICATES.

+2 F 70 (DECEMBER 1997) DELIVERIES. WILL PHASE OUT 3 OPERATING TU-134'S ON DELIVERY OF F 70'S. TU-154B (75A128) BROKEN UP.

OCTOBER 1997: 3,339 EMPLOYEES.

SELECTS INTERSTATE ELECTRONICS, 9002PS, FLIGHT MANAGEMENT SYSTEM FOR 737-200'S.

2 F 70'S, EX-ALITALIA (ALI), 67 PAX, LEASED. PLANS TO LEASE 1 F 70 CONVERTIBLE WITH INTEGRAL, CENTER WING, FUEL TANK, FOR VIP USE. TO SELL TU-134'S AS FOKKER REPLACEMENTS ARRIVE.

767 120 MINUTES EXTENDED TWIN-ENGINE OPERATIONS (ETOPS) FLIGHTS/MONTH: 69 OVER NORTH/MID ATLANTIC, & 18 OVER ASIA/INDIAN OCEAN/AFRICA.

DECEMBER 1997: STILL PROCEEDING WITH (ALI) SALE OF ITS 35% STAKE. LATER, HUNGARIAN INVESTORS BUY (ALI) 35% STAKE FOR $65 MILLION (OTP & MKB BANKS).

HUNGARY IS IN FAVOR OF JOINING THE NORTH ATLANTIC TREATY ORGANIZATION (NATO).

STARTS SCHEDULED FREIGHT SERVICE TO SOFIA WITH 1 AN-26 AIRPLANE OWNED BY BALKAN BULGARIAN (BUL) AND WET-LEASED BY LIN AIR, A HUNGARIAN REGIONAL CARRIER, CURRENTLY OPERATING YAK-40 AIRPLANES.

PLANS TO LEASE 2 737-500'S FROM HAPAG LLOYD (HAP) TO REPLACE 737-200'S IN LATE 1998.

JANUARY 1998: CONTINUES WITH PRIVATIZATION PLANS.

ISRAELI TRAVEL AGENCIES, VOTE MALEV HUNGARIAN AIRLINES (HGA) "BEST FOREIGN AIRLINE TO ISRAEL" OF 121 OPERATORS.

MALEV AIR CARGO OPERATES WET-LEASED AN-12 & AN-26 TO KIEV & KISHINEV. ALSO, PLANS FREIGHTER SERVICE TO SKOPJE, YUGOSLAVIA & TIRANA, ALBANIA.

PUTS +2 F 70'S INTO SERVICE, TO REPLACE TU-134 AIRPLANES.

MALEV (HGA) GOAL IS TO OBTAIN 737-600'S BEFORE 2000. LAST 3 TU-134'S WITHDRAWN FROM SERVICE AFTER 30 YEARS. "D" MAINTENANCE CHECK BY AEROPLEX ON 737-200 (PK285, 49,110 HOURS, 39,322 CYCLES).

FEBRUARY 1998: 737-300 (PQ298, 8,049 HOURS, 5,001 CYCLES), "3C" CHECK BY AEROPLEX.

APRIL 1998: 3,600 EMPLOYEES.

TO LOS ANGELES (LAX) (767-200ER).

AEROPLEX "C" MAINTENANCE CHECK ON UKRAINE AIRLINES INTERNATIONAL (UKR) 737-200 (UR-GAC) 29,382 HOURS, 20,141 CYCLES. NEXT MONTH SENDING 767 (HA-LHA) TO SHANNON AEROSPACE FOR "4C" CHECK, 21,008 HOURS, 2,936 CYCLES.

6TH F 70 (11571) DELIVERY.

767 120 MINUTES EXTENDED TWIN ENGINE OPERATIONS (ETOPS) FLIGHTS/MONTH: 18 ASIA/INDIAN OCEAN/AFRICA, AND 47 NORTH/MID-ATLANTIC.

JUNE 1998: CHARTER FLIGHTS TO LOS ANGELES (LAX).

2/3 ORDERS (1998-12) 737-5K5'S, EX-(HAP).

JULY 1998: EXTENDED TWIN ENGINE OPERATIONS (ETOPS) 170 MINUTES FLIGHTS/MONTH (TOTAL): 2 767 = 84 (3,295) ATLANTIC, 8 (754) AFRICA, INDIAN OCEAN, ASIA.

AUGUST 1998: CODE SHARE WITH BRITISH AIRWAYS (BAB) TO LONDON GATWICK (LGW).

AEROPLEX "C" MAINTENANCE CHECK ON ALITALIA (ALI) 767-300ER.

SEPTEMBER 1998: NEW SERVICE TO BEIJING (767-200) NONSTOP.

NEW $120 MILLION TERMINAL WILL NOW OPEN IN 1998-11.

AFTER HUNGARIAN ELECTIONS, UPPER MANAGEMENT CHANGES, INCLUDING CSABA SIKLOS, CHAIRMAN, FORMER TRANSPORT MINISTER, REPLACES ANDRAS DERZSI. ANTAL PONGRACZ, CEO, EX-CONTROLLER OF HUNGARIAN GAMBLING, REPLACES SANDOR SZATHMARY. FERENC KOVACS, GENERAL MANAGER, MALEV AIR CARGO IS EXPECTED TO BECOME ONE OF DEPUTY DIRECTORS.

FISCAL YEAR (FY) 1997 = -$13.35 MILLION (+$2.31 MILLION).

OCTOBER 1998: AEROPLEX MAINTENANCE CONTRACT FOR AIR KAZAKHSTAN (KAZ) 737-2M8.

NOVEMBER 1998: ACQUIRES 50% OF AEROPLEX (ACE) FROM LOCKHEED MARTIN AIRCRAFT & LOGISTICS CENTER.

737-2M8 (22090) RETURNED TO GECAS, LEASED TO AIR KAZAKHSTAN (KAZ).

DECEMBER 1998: 2 737-5K5'S (24776; 24926), EX-HAPAG LLOYD (HAP), DEFAG 5 YEAR LEASED, "D" MAINTENANCE CHECKS BY ATC LASHAM, UK.

FEBRUARY 1999: (FAA) (FRANKFURT) PERFORMS PART 145 FOREIGN REPAIR STATION CERTIFICATION AUDIT.

1 737-2Q8 (21735) & 1 737-2T5 (22979) RETURNED TO GECAS (GEH) LEASED TO VANGUARD (VAG).

MARCH 1999: SANDOR SZOMORA, CEO AEROPLEX. TAMAS STEFKA, CHIEF ENGINEER, REPLACES ZOLTAN MESAROS.

APRIL 1999: 3,256 EMPLOYEES.

(http://www.malev.hu). (malev@elender.hu). SITA: BUDDCMA.

MAY 1999: NEXT MONTH, ANTAL PEEK, DIRECTOR QUALITY ASSURANCE (QA), AEROPLEX (APX) TO MERGE WITH BENEDEK GYORGY'S TECHNICAL INSPECTION & SURVEILLANCE.

2 ALITALIA (ALI) 767-300ER'S FOR "C" MAINTENANCE CHECKS, + SATCOM, & IN-FLIGHT ENTERTAINMENT SYSTEM MODIFICATIONS.

JULY 1999: TO TRIPOLI, LIBYA. CODE SHARE WITH MOLDOVIAN AIRLINES (MOL) TO KISHINEV, MOLDOVA. STARTS SUMMER CHARTERS WITH 767-200ER TO 10 JAPANESE DESTINATIONS.

SAIR GROUP (SWS) INDICATES INTEREST IN STAKE IN MALEV (HGA) IF IT PRIVATIZES.

AUGUST 1999: TO ZAGREB.

IN EARLY/00 TO ACQUIRE 2 737-300'S & 1 737-400, GECAS (GEH) LEASED AND POSSIBLY +1 767. 3 737-200'S WILL BE RETURNED TO LESSOR. 2 TU-154'S BACK IN OPERATIONS FOR SUMMER CHARTERS.

SEPTEMBER 1999: JOINS WITH LUFTHANSA TECHNIK (LTK) (DLH) TO FORM LUFTHANSA TECHNIK BUDAPEST, UTILIZING 7K SQ M, 2-BAY MAINTENANCE HANGAR AT FERIHEGY AIRPORT IN 3/00. (LTK) (DLH) HAS 85% STAKE.

OCTOBER 1999: FERENC KOVACS, CEO REPLACES DR ANTAL PONGRACZ.

AEROPLEX OF CENTAL EUROPE: CONTACT: SANDOR SZOMORA, DIRECTOR MARKETING & SALES (marketing@mail.aeroplex.com). 13,400 SQ M, HANGARS, FOR 4 WIDE BODIES, FOR 737-200 - 500'S, "A" - "D"; 767-200/-300'S, & F 70'S "A" - "C" CHECKS; TU-134/-154'S "B2;" INCLUDING CORROSION PREVENTION & CONTROL PROGRAM (CPCP), AGING AIRPLANE MODIFICATIONS, INTERIORS, REFURBISHMENTS, STRIP, & PAINT, COMPOSITES REPAIRS, AND SHEET METAL WORK.

NOVEMBER 1999: IN WINTER, TO 46 CITIES IN 35 COUNTRIES. CODE SHARE WITH AEROSVIT (UKA), TO KIEV. TO OSLO.

1998 = -$3 MILLION (-$13.35 MILLION). 1ST 6 MONTHS = +FT1.2 BILLION: +10% (RPK) TRAFFIC, +1.7% (ASK) CAPACITY.

PLANS TO RETURN 3 F 70'S AND ACQUIRE 3 737'S AND 1 767.

DECEMBER 1999: PRIVATIZATION EFFORTS CONTINUE, WITH PLANS FOR 25% STATE, 25% NATIONAL, & 50% AVAILABLE FOR PRIVATE INVESTORS. BRITISH AIRWAYS (BAB) HAS SHOWN SOME INTEREST.

PREVIOUS NEGOTIATIONS, FOR TAKEOVER OF AEROPLEX BY LUFTHANSA TECHNIK (LTK) (DLH), HAVE BEEN PUT ON HOLD, AND BIDS FROM OTHERS, SUCH AS AVIATION SALES (ASC), ARE BEING CONSIDERED. (ASC) WANTS THE AEROPLEX MAINTENANCE DEAL AS A WHOLE, AND DON'T WANT MALEV HUNGARIAN AIRLINES (HGA) LINE MAINTENANCE AND SPARES, WHICH SUITS (HGA), AS THEY HAD INTENDED TAKING THEM BACK FROM AEROPLEX ANYWAY.

JANUARY 2000: ANTAL PONGRACZ, GENERAL MANAGER.

STRATEGIC REORGANIZATION OVER 22 MONTHS. PARTIAL PRIVATIZATION REVIEWED.

SELLS STAKE IN SITA FOR 3.7 BILLION HUF.

GENERAL ELECTRIC PLANS TO BUILD $15 MILLION ENGINE COMPONENT REPAIR FACILITY AT VERESEGYHAZA, NEAR BUDAPEST IN MID 2000, EMPLOYING 150.

MARCH 2000: 737-200 (22803), RETURNED TO (GEH).

APRIL 2000: MALEV HUNGAIAN AIRLINES (HGA) SIGNS AGREEMENT WITH LUFTHANSA TECHNIK (LTK) (DLH) TO FORM A NEW COMPANY TO OVERHAUL NARROW BODY AIRPLANES. (LTK) OWNS 85%, 15% (HGA), USING 1 OF 2 HANGARS, CURRENTLY OCCUPIED BY AEROPLEX, BUT IS 100% OWNED BY (HGA). OPERATIONS TO START IN 2001-01, AND EMPLOY 350.

(FAA) AUDIT OF AEROPLEX.

3,130 EMPLOYEES. IN 2000, (HGA) TO LAY OFF -10 TO -15% EMPLOYEES.

(malev@malev.hu).

TO PARIS (CDG) (6/WEEK). TO ZURICH (5/DAY).

IN 2000, TO ACQUIRE 2 737-300'S & 1 737-400. POSSIBLE 1 767-300ER, EX-GULF AIR (GUL), PEMBROKE (PEB) LEASED. ALSO, POSSIBLE 1 767-300ER, (ILF) LEASED 7/00 & 1 767-300ER, (GEH) LEASED 2000-11. LATER, DECIDES ONLY TO TAKE 1 767-300ER, EX-(GUL). WILL RETIRE LAST 737-200 IN 2000-09, AND ITS TU-154 FLEET BY 2001. F 70'S TO BE REPLACED BY ATR72'S. 1 737-300 (24676), EX-SUNEXPRESS (SNS), (GEH) 3 YEAR LEASED. 1 737-3Y0 (24910, HA-LET; 737-4YO), EX-SUNEXPRESS (SNS), GECAS (GEH) 3 YEAR LEASED. 737-2T4 (22804) RETURNED TO (GEH). LETTER OF INTENT (LOI) 1 ORDER (2000-06) 767-3P6ER (24484, /89 42 13), EX-GULF AIR (GUL). 737-2T4 (22803) & -2K9 (23404) RETURNED TO (GEH).

MAY 2000: LETTER OF INTENT (LOI) 4 ORDERS (2000-11) ATR72.

JUNE 2000: ZSOLT HERNADI, CHAIRMAN, REPLACES CSABA SIKLOS.

TO LAY OFF -400 EMPLOYEES FROM 3,509, AT END OF 1999, TO 3,070 BY THE END OF 2000.

A NEW CHARTER AIRLINE, "PANNON AIRLINES" STARTED SERVICES IN HUNGARY FLYING TU-154'S TO HOLIDAY RESORTS IN NORTHERN EUROPE.

1 767-3P6ER (CF6-80C2) (267-24495, /89 42 14), EX-(GUL), PEMBROKE (PEB) LEASED.

JULY 2000: FERENC SZARVAS, PRESIDENT REPLACES ZSOLT HERNADI, WHO RESIGNED, BUT IS STILL A MEMBER OF THE BOARD.

1999 = +$19.7 MILLION (-$2.55 MILLION): 3.32 BILLION (RPK) TRAFFIC (+10.6%); 60.1% LF LOAD FACTOR (+.3); 43.38 MILLION (FTK) FREIGHT (+11.4%); 2.18 MILLION PASSENGERS (PAX) (+9%); 3,130 EMPLOYEES.

INCDT: (HGA) TU-154B-2 (HA-LCR) WRITTEN OFF (W/O) IN GO-AROUND AT THESSALONIKI, WHEN IT STRUCK THE GROUND.

AUGUST 2000: 767-300ER (24483), EX-(GUL), (PEB) LEASED.

SEPTEMBER 2000: KAROLY GALVACSY, MANAGER ENGINEERING REPLACED JOZSEF KRAJLIK, NOW MANAGER, MAINTENANCE CONTRACTS. VIKTOR HAJSO, MANAGER MAINTENANCE & PLANNING REPLACED JOZSEF POP, WHO IS NOW RESPONSIBLE FOR TECHNICAL RECORDS. SANDOR ZAVICSA, ENGINEERING MANAGER, AEROPLEX (INTERIM), REPLACING ZSOLT POPROADI, WHO RESIGNED.

OCTOBER 2000: DR ERZSEBET ANTAL, ACTING CEO REPLACES FERENC KOVACS, WHO RESIGNED.

1 737-2K9 (23404) RETURNED TO BAVARIA (BAV) LEASING. 5 TU-154'S TO BE RETIRED BY 3/01.

DECEMBER 2000: 767-3P6ER (24484, HA-LHD), DISPLAYS "1000 YEAR OLD HUNGARY." MODERN-DAY HUNGARY, WAS SETTLED IN THE 8TH CENTURY, BY THE FINNO-UGRIAN, MAGYAR PEOPLE. IN 1867, AUSTRIA-HUNGARY WAS FORMED, BUT WAS SUCCEEDED BY THE HUNGARIAN REPUBLIC IN 1918.

TU-154B-2 (81A-474) RETIRED.

JANUARY 2001: CODE SHARE WITH (KLM) TO AMSTERDAM (4/DAY).

MALEV HUNGARIAN AIRLINES (HGA) PRIVATIZATION EFFORTS VIRTUALLY COLLAPSED, WHEN ALL POTENTIAL INVESTORS WITHDREW FROM BIDDING FOR A STAKE, BECAUSE OF THE PRESENT NUMEROUS AIRLINES IN THE MARKET, WHICH ARE ALSO OFFERED FOR SALE AT THIS SAME TIME.

INTENDS TO RETURN 767-300, 218 PAX TO LESSOR IN 10/01. ALL 5 TU-154'S TO BE WITHDRAWN FROM OPERATIONS IN 2001-03. CURRENTLY, ALL ARE FOR SALE ($360,000 TO $540,000).

FEBRUARY 2001: STOPPED FLYING OPERATIONS FOLLOWING MAINTENANCE STAFF STRIKE.

RESUMED SERVICES WHEN EMPLOYEES ACCEPTED +9% INCREASE (WANTED 15%).

MARCH 2001: 2000 = -$35 MILLION: 3.54 BILLION (RPK) TRAFFIC (+8.1%), 47.82 MILLION (FTK) FREIGHT (+5%), 2.08 MILLION PASSENGERS (PAX) (+6.8%).

1 737-4Q8 (24904), EX-TURKISH (THY), DEBIS (AFJ) LEASED. 1 737-4Q8 (26290), EX-PEGASUS (PGS), TRITON (TIA) LEASED. 1 737-4YO (24682), EX-HELIOS (HCY) & 1 737-3YO (24682), EX-SATA (SAP), (GUI) LEASED.

MAY 2001: PLANS TO REDUCE ITS WORKFORCE BY -25% OR -1,000.

TIBOR BESENYI, MANAGING DIRECTOR, AEROPLEX, EX-(GE) HUNGARY REPLACES TAMAS STEFKA, WHO RESIGNED TO JOIN DORNIER, GERMANY.

MFB BANK AGREES TO LOAN MALEV HUNGARIAN AIRLINES (HGA) 20 BILLION HUF (GUARANTEED BY GOVERNMENT).

FY 2000 = -9.3 BILLION HUF.

JUNE 2001: 1 737-3YO (1973-24902, /91 24 14 HA-LEX), (GUI) LEASED.

JULY 2001: JOSZEF VARADI, CEO, REPLACES EZSEBET ANTAL.

HAS (ISO) 9001 QUALITY CERTIFICATION.

(malev@malev.hu). 3,130 EMPLOYEES.

1 737-4YO (1824-24682, /90 28 22 HA-LEY), (GEF) LEASED.

NOVEMBER 2001: 10/6 ORDERS (2003-02) 737-600/-700/-800'S (CFM56-7B), (ILF) LEASED: 2 737-600'S; 6 737-700'S; & 2 737-800'S.

DECEMBER 2001: VIKTOR HAJSO, TECHNICAL DIRECTOR REPLACES TAMAS STIFTER.

MARCH 2002: EUROPEAN AIRSPACE IS NOW OPERATING UNDER REDUCED VERTICAL SEPARATION MINIMUM (RVSM) RULES. FROM LATE 2002-01, THE MINIMUM VERTICAL SEPARATION BETWEEN AIRPLANES, HAS BEEN REDUCED TO 1,000 FEET. AS A RESULT, ACCORDING TO EXPERTS, +20% MORE AIRPLANES WILL BE ABLE TO FLY IN EUROPEAN AIRSPACE AT THE SAME TIME. (HGA) EXPECTS THIS TO TRANSLATE INTO REDUCED FLIGHT DELAYS. ALL (HGA) AIRPLANES ARE NOW EQUIPPED WITH UPDATED (TCAS) SYSTEMS TO ALLOW THEM TO USE THE NEW REDUCED SEPARATION RULES. EUROPEAN SKIES ARE NOW LESS CROWDED.

2/6 ORDERS (2002-06) CRJ200ER'S, 50Y.

APRIL 2002: CODE SHARE WITH AEROFLOT (ARO) TO MOSCOW.

3,101 EMPLOYEES.

MAIN BASE: BUDAPEST - FERIHEGY (BUD).

SITA: BUDDMA.

OWNERS/SHAREHOLDERS: GOVERNMENT (97%); MUNICIPALITIES (0.528%); AIRLINE EMPLOYEES (0.524%).

ALLIANCES: AEROFLOT (ARO); AEROSVIT (UKA); AIR BOSNA; AIR FRANCE (AFA); ALITALIA (ALI); AUSTRIAN AIRLINES (AUL); (CSA) CZECH AIRLINES; MOLDAVIAN (MOL); & SWISS (CSR).

July 2002: New Government, which was voted in last May 2002, OK's Malev Hungarian Airlines (HGA) fleet modernization schedule (including 737NG's & CRJ200's) and will inject $23 Million into (HGA), to improve capitalization.

2001 = -$41.4 Million (-$22.21 Million): 3.09 Billion (RPK) traffic. 1st 6 months operating loss = -$11 Million (+50%).

1 CRJ-100ER (7032, HA-LNX), Bombardier leased.

August 2002: To Timisoara (daily). Will code share with Northwest (NWA) to New York and Frankfurt.

Andras Huszty, 53, President.

September 2002: 2 CRJ-200ER'S (7676, HA-LNA; 7686, HA-LNB), deliveries.

October 2002: Lufthansa Technik Budapest, a joint venture of Lufthansa Technik (LTK) AG (85%) and Malev Hungarian Airlines (HGA) (15%), officially inaugurated refurbished Maintenance Repair & Overhaul (MRO) facilities at Budapest Ferihegy Airport, after investing HUF4 Billion/$16.1 Million to renovate and modernize its 2 hangars.

CL-600-2B19 (7032) returned to Bombardier.

November 2002: (HGA) Express, in 2003-07, to Geneva (CRJ200, 2/day).

January 2003: In 2003-05, Budapest - Split (F 70 & CRJ200, 4/week).

2 737-7Q8's (28254, HA-LOA; 28346, HA-LOB), (ILF) leased. Has luxury leather seats and seat spacing, particularly in Sky Club class, that will be better than the international average.

February 2003: 2002 = -HUF 2.3 Billion: 2.95 Billion (RPK) traffic (-6.6%); 2.2 Million passengers (PAX) (+1%); 63.1% LF load factor (+3.6); 27.16 Million (FTK) freight (-46.5%).

March 2003: Code share with (KLM), Budapest - Skopje (F 70/CRJ200, weekly). Budapest - Pristina (5/week). In 2003-07, Budapest - Geneva (CRJ, daily).

Following a government investigation into the tendering process for commissioning a special audit of the company, Andras Huszty, Chairman of the board, and Jozsef Varadi, CEO, are to be sacked for not acting in an appropriate manner.

2 737-3YO's (24676; 24910), returned to (GEF), leased to Norwegian (NWG). 737-4YO (25190), returned to (GEF). 1st 737-800 (HA-LOC) delivery.

May 2003: Laszio Sandor, CEO, 46-year old former Budapest Waterworks Company chief.

June 2003: 3,130 employees. SITA: BUDDGMA.

September 2003: Budapest - Zagreb.

October 2003: 737-6Q8 (28259, HA-LOD), (ILF) leased.

November 2003: In 2004-02, Budapest - London Stansted (STN).

Both 767-27GER's are for sale.

December 2003: Plans to reduce costs by -HUF 8 Billion/-$37.3 Million in the 1st half of 2004 to become profitable. The Hungarian government will inject HUF 10 Billion/$46.6 Million into (HGA) in two tranches before 2004-05, when Hungary joins the European Union (EU).

January 2004: 737-6Q8 (28261) (ILF) leased.

February 2004: Code share with Moldavian International (MOL), Budapest - Chisinau. Budapest - Dubrovnik (3/week).

737-5K5 (24926) returned to lessor. 737-6Q8 (29349, HA-LOJ), 737-7Q8 (29350, HA-LOI), & 737-8Q8 (30667, HA-LOH), (ILF) leased.

March 2004: Could become an associate member of the SkyTeam (STM) alliance by 2004-11, following a Letter of Intent (LOI) signed with (CSA) Czech Airlines for cooperation.

Code share with SN Brussels (DAT), Budapest - Brussels. In 2004-06, Budapest - Varna (CRJ/F 70, 3/week). Adds 7 new routes from Budapest increasing its number of destinations to 60: Budapest - Lyon (daily); Ljubjana (13/week); Vienna (2/day); Dubrovnik (3/week); Ekaterinburg (2/week); & Varna (3/week). In 2004-08, code share with Hainan Airlines (HNA), Budapest - Beijing.

April 2004: 737-7Q8 (29352, HA-LOL) & 737-8Q8 (30669, HA-LOK), (ILF) leased.

May 2004: 2,610 employees. SITA: BUDDCMA.

To receive HUF 3 Billion/$14.1 Million from government in 2004-10, providing it revises its business plan and shows a +ve result by 2004-08.

737-4YO (26069) returned to GECAS (GEF). 737-6Q8 (29353, HA-LON), & 737-8Q8 (30672, HA-LOM), (ILF) leased.

June 2004: 2003 Fiscal Year (FY) = -$60.16 Million (-$10.79 Million): 3.8 Billion (RPK) traffic (+10.2%); 66.9% LF load factor; 2.62 Million passengers (PAX) (+8%); 28.86 Million (FTK) freight (-19.1%).

Code share with (TAP) Air Portugal, Lisbon - Budapest.

Malev Hungarian Airlines (HGA)'s privatization may get a boost from an unlikely source: Hainan Airlines (HNA), possibly in partnership with billionaire financier George Soros, who is a shareholder of (HNA). Laszlo Sandor, President & CEO and Chen Feng, Hainan (HNA) Group signed an extende cooperation agreement. In 2004-07, a (HNA) 767-300ER will operate in cooperation with (HGA), Hungary - China (3/week).

(HGA) received a recent EUR 27.7 Million/$33.7 Million recapitalization by the government, which has cleared the way for investment in the airline.

(HGA) is working to become an associate member in the SkyTeam (STM) Alliance by 2004-11.

Signed up for Amadeus's community-based sales & reservations platform Altea Sell. To power its commercial website and deliver online sales, (HGA) will use Amadeus e-Travel Planitgo.

August 2004: Chinese partner Hainan Airlines (HNA) may be interested in placing a bid when the state-owned carrier is privatized later this year.

September 2004: Will be privatized this fall, with bids due by October 20, but finding an investor may be difficult. Potential bidders include Hainan Airlines (HNA) (interested in acquiring 100%), in which Hungarian-born billionaire George Soros holds a key investment, Austrian Airlines (AUL); and the Air France (AFA)/(KLM) consortium.

Plans to replace its F 70's with CRJ's.

Code share with Swiss International (CSR), Budapest to Geneva & Zurich.

October 2004: 737-7Q8 (29354, HA-LOP), (ILF) leased.

November 2004: Received a single bid worth EUR 600,000/+$781,740 and the assumption of some of Malev (HGA)'s debt from Aviation Solution International, a consortium backed by Aeroflot Russian Airlines (ARO). As this sole bid did not meet the requirements, privatization plans have been suspended.

737-7Q8 (29355, HA-LOR), (ILF) leased.

December 2004: May not receive a 3 Billion forint/$16.2 Million cash injection from the Hungarian government as airline is faring much better.

January 2005: Lazlo Sandor, President & CEO, resigned for personal reasons.

Has complete preparations for joining SkyTeam.

Retired its last 737 classic. Now has 6 737-600's, 7 737-700's, & 5 737-800's.

March 2005: 737-7Q8 (29359, HA-LOS), (ILF) leased.

April 2005: Budapest to Constanza (F 70, 2/week). Dublin and Helsinki to Athens (737-300, 3/week).

2004 = -2.11 Billion forints/-$11 Million (-4.3 Billion forints).

May 2005: Budapest - Cork (3/week). Malev Hungarian Airlines (HGA) currently serves 55 destinations in 34 countries with a fleet of 29 airplanes.

New management decided that SkyTeam (STM) alliance was not in their best interests so instead signed a Memo of Understanding (MOU) to join the OneWorld (ONW) alliance at the end of 2006 as a full member.

June 2005: As the Hungarian national airline, Malev (HGA) operates a network of services to Europe, the Middle East, North Africa, North America, and Asia.

2,610 employees.

(IATA) Code: MA - 182. (ICAO) Code: MAH - (Callsign - MALEV).

Parent organization/shareholders: Hungarian government (97%); municipalities (0.528%); & employees (0.524%).

Owns: Malev Express (100%); & Air Italica.

Alliances: Aeroflot Russian Airlines (ARO); AeroSvit Airlines (UKA); Air Europa (ARE); Air France (AFA); Alitalia (ALI); Austrian Arrows; (CSA) Czech Airlines; Finnair (FIN); Hainan Airlines (HNA); (KLM); (LOT) Polish Airlines; Moldavian Airlines (MOL); Northwest Airlines (NWA); SN Brussels Airlines (DAT); Swiss (CSR); & Tarom (TRM).

Main Base: Budapest Ferihegy airport (BUD).

International, Scheduled Destinations: Amsterdam; Athens; Beirut; Berlin; Bolgna; Brussels; Bucharest; Cairo; Copenhagen; Damascus; Dublin; Dusseldorf; Frankfurt; Geneva; Hamburg; Helsinki; Istanbul; Kiev; Krakow; Larnaca; Ljubljana; London; Lyons; Madrid; Milan; Moscow; Munich; New York; Odessa; Paris; Prague; Pristina; Rome; Sarajevo; Skopje; Sofia; Stockholm; Stuttgart; Tel Aviv; Thessaloniki; Timisoara; Tirana; Toronto; Tripoli; Varna; Venice; Warsaw; Zagreb; & Zurich.

August 2005: Malev Hungarian Airlines (HGA)'s privatization process failed for the fifth time. State Privatization and Holding (APV) cancelled the sale. According to the "Budapest Business Journal," the board of (APV) decided that none of the bids met its expectations and closed the tender. The sale had been criticized by some, with both opposition party Fidesz and the airline's trade union calling for a halt citing various reasons. (APV) said the sale will be relaunched after completion of the Budapest Airport sale, expected by year end.

Separately, Copenhagen Airport said it had been short-listed for the airport privatization.

September 2005: By a code share, Japan Airlines (JAL) will put its code on Malev (HGA) flights from Budapest to Frankfurt. The agreement will take effect October 30, subject to government approval.

SITA INC said British Airways (BAB), Cathay Pacific (CAT), China Eastern Airlines (CEA) and Malev (HGA) signed contracts with a total value of $10 million for its new Airfare Insight solution. Airfare Insight, part of SITA's Airfare suite of applications, enables airlines to manage their entire fare structure in one system.

October 2005: Malev (HGA) will launch thrice-weekly nonstop service from Budapest to Tirgu Mures, Romania, by January 16, becoming the first international carrier to serve the Transylvanian city. The airline will operate 3 flights a week, on Mondays & Wednesdays with a CRJ-200 and on Thursdays with a 737-700. (HGA) will inaugurate nonstop service from Saarmelleek/Balaton to Berlin Tegel on April 2nd. The airline will operate 1 flight a week, on Sundays using a 737-600. (HGA) will inaugurate nonstop service from Saarmelleek/Balaton to Copenhagen on May 21st. The airline will operate 1 flight a week, on Sundays, using a 737-600.

November 2005: Malev Hungarian Airlines (HGA) will start a 3X weekly service to Bangkok on December 2 using 767-200ERs. During the winter season, service to New York will be reduced to 4X weekly and service to Toronto to 3X.

AiRUnion, the alliance of Russian airlines under a single management company, wants to move toward a full merger in 2006, an official said in Moscow. Members of the group are Krasair (ZXD), Domodedovo Airlines (DOD), Omskavia, Samara Airlines (SMR) and Sibaviatrans. Should the combination take place, the resulting carrier will surpass Sibir (SBR) to become the second-largest in Russia in terms of passengers. AiRUnion currently operates about 100 airplanes and has begun taking delivery of 10 737-200s, VP-Sales and Marketing/International Affairs Urs Herzig said. "Besides that, we will also be looking for new Russian airplanes like the Il-96 and Tu-204s and Tu-214s," he said. AiRUnion also operates four 767s and wants to build its fleet around Western airplanes. Next summer, it will open four routes to China. In addition to other destinations in the Far East, it is looking for flights to the USA. So far, no more information has been given about future passenger figures or financial details. The company possibly is interested in participating in the privatization of Malev (HGA) when the process is restarted; "Malev (HGA) would fit well with our needs," Herzig said.

Malev (HGA) formally accepted an invitation to join the Oneworld (ONW) alliance at a ceremony in Budapest, having satisfied most of the conditions established by a Memo of Understanding (MOU) signed six months ago. (HGA) passed alliance audits of its quality and safety standards, but the invitation remains subject to its continued progress toward profitability in 2007 and the conclusion of bilateral agreements with existing partners. (HGA) will give the (ONW) alliance the foothold in Central and Eastern Europe that the SkyTeam (STM) alliance enjoys with (CSA) Czech Airlines and the Star (SAL) Alliance with (LOT) Polish Airlines.

"Joining the (ONW) alliance is a crucial element of Malev (HGA)'s turnaround plan," Chairman, Peter Honig said. "No medium-sized airline can achieve sustainable earnings without partners. We are very proud to have been invited to fly alongside some of the biggest and best airlines in the world."

Over the next 15 months or so, (HGA) and its (ONW) alliance sponsor Finnair (FIN), with whom it already has a code share agreement, will work on connecting the carrier's Information Technology (IT) systems, bringing operations into line with alliance requirements, employee training and other tasks. As a full-fledged member, (HGA) would expand the (ONW) alliance's network by 11 destinations including Zagreb, Odessa, Sarajevo and Skopje. Its fleet comprises 29 airplanes including 18 737s.

December 2005: British Airports Authority (BAA) took a 75% majority controlling stake in Budapest Ferihegy Airport (BUD) after outbidding Hochtief and Fraport of Germany. The deal includes a 75-year asset management contract. The Hungarian government will retain 25%.

Later, (BAA) finalized its acquisition of Budapest Airport (BUD), agreeing to take a 75%-minus-one-share stake in the company from the Hungarian government plus a 75-year asset management contract for Budapest Ferihegy International Airport (BUD) for a cash consideration of £1.255 billion/$2.22 billion. (BAA) pledged an additional €261 million/$313.4 million for capital improvements over the next six years. It outbid Fraport and Hochtief, with the latter filing a lawsuit in Hungary yesterday contending (BAA) did not comply with all the terms of the bidding process.

The obligation that the UK airport operator is assuming appears high in light of Budapest Airport (BUD)'s balance sheet. It posted a 2004 pre-tax profit of +€48 million and reported net assets of €75 million as of September 30. The deal will be financed with funds from a bank facility, (BAA) said, which will be refinanced through debt capital markets. (BAA) said its net debt will peak at approximately £8 billion in 2012 - 2013.

"Budapest (BUD) plays to all (BAA)'s strongest attributes. It is a growing airport where our development, retail and property skills can all contribute. For us it is a perfect fit," (BAA) CEO Mike Clasper said in a statement. "(BUD) is right in line with our international strategy, and we have won it at a fair price, reflecting the true value to (BAA) of the assets involved, rather than any wider strategic benefits. We have done our homework thoroughly and we have a management team standing by and ready to go."

(BAA) said (BUD) will generate (EBITDA) of €68 million in 2005, a +11.5% rise over 2004, and see a +20% growth in traffic to 7.8 million passengers. (EBITDA) is expected to increase to €148 million by 2011, and by 2020 (BAA) projects (EBITDA) of €273 million and 19.4 million passengers. Budapest (BUD) will generate 63% of its revenue this year from airline fees and 37% from concessions revenue and nonairline rents. (BAA) did not indicate if that breakdown will change going forward.

January 2006: Becomes the first airline to serve the newly renovated airport at Tirgu Mures in Transylvania, when it launches flights to the Romanian destination from Budapest on January 16.

February 2006: Malev Hungarian Airlines (HGA) said it carried 2.7 million passengers in 2005, up +8.7% over 2004.

March 2006: Malev Hungarian Airlines (HGA) is increasing weekly service to Romania. From March 26, it will operate up to four daily flights between Budapest and Bucharest, raising weekly frequencies from 15 to 26. It will add one weekly flight to its Tirgu Mures and Constanta services and offer three more flights to Timisoara.

April 2006: Malev Hungarian Airlines (HGA) will re-launch a Budapest - London Gatwick route from May 1 with two daily flights on weekdays and 1 on weekends using a 737-600. Malev (HGA) flies to Heathrow twice-daily.

May 2006: Malev Hungarian Airlines (HGA) reported a loss of -HUF1.3 billion/-$6.1 million for its fiscal year, a +HUF3.6 billion improvement over a loss of -HUF4.9 billion in 2004.

Iberia Airlines (IBE) will place its code on Malev Hungarian Airlines (HGA)'s thrice-weekly, Malaga - Budapest service beginning May 2.

Malev (HGA) and German Regional OLT launched flights between Debrecen and Budapest this month using OLT's Saab 340s operating with Malev (HGA) flight numbers. In addition, OLT announced it is creating a subsidiary called Civis Air to make it possible for its aircraft to operate with Hungarian crew and be maintained under a Hungarian registration number in Debrecen. Civis expects to carry more than 50,000 passengers to/from Debrecen by 2010. OLT's fleet consists of 16 Saab 2000s, Saab 340s, Metroliners, Cessna 404s and Cessna 208Bs. It also operates twice-daily flights between Budapest and Ljubljana on behalf of Malev (HGA).

June 2006: Malev Hungarian Airlines (HGA), scheduled to become a Oneworld (ONW) alliance member early next year, expects to report breakeven results for 2006. "We are expecting a drastic growth in terms of passengers thanks to the (ONW) membership, which should double passenger figures from the 3 million of today," CCO, Andras Zboray, said at the (IATA) Anuual General Meeting (AGM) in Paris. (HGA) is planning to extend its network to more destinations in Eastern Europe starting with the Balkans, cities in the southeastern Mediterranean, and other markets within 3 hours of Budapest. It will add a third 767-300ER to its fleet next year. The carrier, which has debts of €120 million/$155 million and three failed privatization attempts, already has reduced its employment rolls by -10% and has taken other initiatives to help its bottom line. It plans to sell its four CRJs and replace them with F 70s and intends to extend third-party (MRO) work for carriers like Air Berlin (BER) and germanwings (RFG) hoping to benefit from lower labor costs in Hungary, an "advantage we should have for another 10 years," Zboray said.

British Airways (BAB) and (HGA) signed a code share agreement effective November 1, placing (BAB)'s code on Malev (HGA)'s twice-daily, London Gatwick (LGW) - Budapest (BUD) flights and seven Eastern European routes from (BUD). (HGA) will place its code on (BAB)'s thrice-daily London Heathrow - (BUD) service and on flights to five British markets from (LGW).

September 2006: Malev (HGA) signed for the lease of 3 767-300s to replace its current fleet of 2 767-200s. (HGA) is expected to take delivery of 1 767-300 each in 2007, 2008 and 2009, while the pair of 767-200s will remain in the fleet through the summer 2007 season.

October 2006: Malev Hungarian Airlines (HGA) said it will add 10 new e-ticket destinations in the USA as part of an agreement with future Oneworld partner American Airlines (AAL). At present, (HGA) e-ticketing is available to 28 cities from Budapest.

Hochtief announced that a consortium led by its Hochtief AirPort subsidiary signed a Memo of Undestanding (MOU) with airports operator (BAA) for the "potential acquisition" of the British firm's stake in Budapest Ferihegy airport.

(BAA) purchased a 75%-minus-one-share stake from the Hungarian government last year for £1.26 billion/$2.37 billion.

Hochtief said its stake in the consortium is "almost 50%." Other members are Caisse de Depot et Placement du Quebec of Montreal and KfW of Frankfurt. The deal is expected to be finalized before year end, Hochtief said, adding that "confidentiality has been agreed on the details until further notice."

(JAL) and Malev Hungarian Airlines (HGA) expanded their code share agreement to include (HGA)'s daily, Budapest - Amsterdam service from October 29.

November 2006: Malev (HGA) will launch twice-weekly, Budapest - Bangkok service from November 15 aboard 767-200ERs.

January 2007: Malev Hungarian Airlines (HGA) and American Airlines (AAL) signed a code share and frequent-flier program harmonization agreement. From the summer timetable, (AAL) will add its code to Malev (HGA)'s New York (JFK) flight as well as numerous other services to Eastern Europe and Balkan destinations. (HGA)'s code will appear on several domestic flights operated by (AAL). (HGA) will join the Oneworld (ONW) alliance this year.

(HGA) implemented interline e-ticketing with Royal Jordanian (RJA).

February 2007: The Oneworld (ONW) alliance confirmed that Royal Jordanian (RJA), Japan Airlines (JAL)/(JAS), and Malev Hungarian Airlines (HGA) will join the (ONW) alliance as full members on April 1. Five additional subsidiaries of JAL Group (JAL)/(JAS) will join the same day as affiliates: JALways (JAI), Japan Asia Airways (JAA), JAL Express (JEX), J-AIR and Japan Transocean Air (SWL). At the same time, Aer Lingus (ARL) will withdraw from the alliance. Three other airlines are lining up to join as affiliates in 2007: Dragonair (DRG), LAN Argentina (LNR), and LAN Ecuador (LNE). The membership changes will expand the (ONW) alliance's reach to almost 700 airports, nearly 150 countries and 9,000 daily departures by around 2,500 airplanes.

(HGA) will be sold to AirBridge, a Hungarian company backed by Russia's KrasAir (ZXD), according to a statement from the state privatization agency cited in press reports from Budapest. No information was provided by the agency about the terms of the sale. It marks the seventh time the government has put (HGA) up for bid.

Later, (HGA)'s sale to AirBridge, a consortium led by Russian carrier KrasAir (ZXD), was concluded. The purchase price was a little more than >$1 million, according to press reports. The consortium committed to capital investment of $66 million and the repayment of $68 million in debt by year end, according to "UPI," while the British Broadcasting Corporation (BBC) reported that KrasAir (ZXD) CEO, Boris Abramovich said (HGA) will return to profitability within two years.

March 2007: Malev Hungarian Airlines (HGA) followed Royal Jordanian (RJA) into the Oneworld (ONW) alliance, becoming the group's 10th member. "It is vital in today's airline industry for a medium-sized airline like (HGA) to have the best of the best as partners, to achieve long-term efficiencies and sustainable profitability," Chairman, Boris Abramovich said. (HGA) adds 10 cities to the (ONW) alliance's network, which will include Macedonia and Montenegro for the first time.

767-306ER (28884, PH-BZM), ex-(KLM), (ILF) leased.

April 2007: Malev Hungarian Airlines (HGA) will launch four-times-weekly, Budapest - Yekaterinburg service April 27 aboard 737NGs.

Starts Budapest - Ekaterinburg, using 737-600s.

Japan Airlines (JAL)/(JAS) completed (ONW) alliance's spring expansion, joining (HGA) and Royal Jordanian (RJA) as members of the alliance. (JAL)/(JSA) subsidiaries JALways (JAI), Japan Asia Airways (JAA), JAL Express (JEX), J-AIR and Japan Transocean Air (SWL) are new (ONW) alliance affiliate members. (JAL)/(JAS) was the largest airline in the world outside one of the three major alliances, the (ONW) alliance said. It adds nearly +50 airports to the grouping's network and one new country, Guam. LAN Argentina (LNR) and LAN Ecuador (LNE) also are new affiliate members, while Aer Lingus (ARL)'s withdrawal now is official. Dragonair (DRG) will join as an affiliate member later this year.

May 2007: Malev Hungarian Airlines (HGA) announced that its sale to "AirBridge," a consortium led by KrasAir (ZXD) CEO, Boris Abramovich, was completed with the transfer of shares from the Hungarian government. The transaction includes AirBridge's assumption of (HGA)'s loans and is part of the consortium's €102 million/$138.6 million investment in the carrier.

June 2007: Malev Hungarian Airlines (HGA) said its 2007 business plan will allow it to reduce significantly the operating and pre-tax losses suffered last year. Buoyed by its membership in the Oneworld (ONW) alliance and its recent privatization, it expects to report a -HUF7.5 billion/-$40.1 million pre-tax loss this year, compared to -HUF10.5 billion in 2006, along with an operating loss of -HUF5.3 billion, that will represent considerable improvement from the -HUF10.8 billion deficit suffered last year. (HGA) said its gains will be based on "increasing passenger traffic, an even greater market share and the impact on growth in traffic deriving from membership [in (ONW)]," which it said will benefit its bottom line by +HUF3 billion, in addition to "extremely rigorous cost management."

New owner AirBridge has agreed to invest €102 million/$137.9 million in (HGA). (HGA) said its forecasted losses may improve further because its business plan "does not include the concepts of a new investor." It carried more than >3 million revenue passengers in 2006, nearly +9% more than in the previous year, with revenue increasing +11% to HUF107.9 billion. Costs rose +10% to HUF136.6 billion.

(HGA) announced the appointment of former (LOT) Polish Airlines Executive, Piotr Ikanowicz as CFO, and investment banking specialist Zoltan Mester as Chief Officer Infrastructural & Portfolio Management.

July 2007: Malev Hungarian Airlines (HGA) announced that CEO, Janos Gonci has left the post "by mutual agreement" and will be replaced by former British Airways (BAB) executive and Air Astana (AKZ) CEO, Lloyd Paxton. Gonci remains a member of the (HGA) board, the airline said. Paxton joined (BAB) in 1960, and held a wide variety of positions over 35 years at the airline before moving to Kazakhstan. (HGA) credited Gonci with facilitating its recent privatization and the (ONW) alliance membership and "maintaining the corporation's liquidity."

(ONW) alliance partners American Airlines (AAL), Iberia (IBE), Finnair (FIN), (HGA), and Royal Jordanian (RJA) filed a request for antitrust immunity (ATI) with the USA Department of Transportation (DOT), effective March 30, 2008, the day the USA-(EU) "open skies" agreement becomes active. The five carriers said they wish to cooperate on code sharing, loyalty programs, route and schedule planning, advertising and marketing, pricing and yield management, revenue allocation, ground handling, cargo, Information Technology (IT) and distribution, and other areas. "We believe that an alliance with antitrust immunity is of vital strategic importance and will help us remain competitive with other transatlantic alliances, that already have such immunity," (AAL) Senior VP Planning, Henry Joyner said. Six SkyTeam (SKT)alliance carriers filed a similar request last month.

September 2007: Malev (HGA) Vice Chairman, Peter Leonov has taken over the CEO position as well, replacing Lloyd Paxton, who left unexpectedly citing personal reasons.

October 2007: Malev Hungarian Airlines (HGA) will increase its daily Budapest - Madrid service to 11-times-weekly from October 28. Flights to Bangkok will rise to four-times-weekly, beginning January 8 and daily service to Venice will become 12-times-weekly on October 28. Twice-weekly, Budapest - Ekaterinburg flights will launch the same day. For the winter schedule, Malaga, Dubrovnik and Split will be removed temporarily from the network, while Krakow will be canceled permanently.

November 2007: Malev Hungarian Airlines (HGA) will suspend its two North Atlantic routes starting in mid-November and lasting through the winter season. Budapest - New York (JFK), and Budapest - Toronto services should resume in the spring. (HGA) said that as part of its structural transformation and cost-efficiency program, it will lease out two 767-200ERs, while a single 767-300ER will continue flying to Bangkok. That thrice-weekly service will become four-times-weekly from January 8.

(HGA) announced that it will cut staffing levels by -9%, resulting in annual savings of -HUF1.2 billion/-$6.9 million. It did not say when the layoffs will take place. (HGA) employs 3,508 and said it will cut a "maximum" of -250 workers even though -9% would equal -315. CEO, Peter Leonov confirmed the -9% figure, saying that "besides reducing expenditures, optimization of the staff level is necessary primarily to ensure that 91% of the employees . . . can continue to have a secure workplace."

(HGA) will suspend flights from Budapest to New York (JFK) and Toronto during the winter schedule, and plans to lease out two 767-200ERs. (HGA) also announced that Geza Fehervary will succeed 737 Captain Peter Krauth as COO, effective December 1. Krauth will remain with the airline. Fehervary served as COO, from October 2002 to April 2006.

December 2007: The European Commission (EC) has contacted Hungarian authorities regarding the control and ownership of Malev Hungarian Airlines (HGA), the (EC) Directorate General for Energy & Transport confirmed. The (EC) is seeking reassurance that (HGA) still fulfills all conditions required to be an (EU) carrier. Doubts regarding its status follow its privatization last spring. The Hungarian government sold a 99.95% stake in the airline to AirBridge, a Hungarian company affiliated with Russian carrier KrasAir (ZXD).
According to the press release issued by the legal firm that advised on the (HGA) sale, "AirBridge is a holding company member of the Russian AiRUnion-Krasair Group (ZXD)/(DOD)/(OMK)/(SMR), which is considered to be the second largest Russian airline alliance after Aeroflot (ARO)." AiRUnion combines KrasAir (ZXD), Domodedovo Airlines (DOD), Omskavia (OMK), Samara Airlines (SMR), and Sibaviatrans. The Hungarian press commonly describes Malev (HGA) as a Russian-controlled or Russian-owned carrier. "The legislation is very clear. If a carrier is owned more than >49% by non-(EU) interests and is effectively controlled by non-(EU) interests, it is no longer a community carrier and it cannot benefit from the single European market," said Gilles Gantelet, deputy head of Unit F1 responsible for internal market, air transport agreements and multilateral relations. He acknowledged that certain companies are established specifically to conform to (EU) rules, but he would not conclude this is the case with (HGA). "We are in touch with the Hungarian authorities on this issue," he said, noting it is the responsibility of national authorities to guarantee application of the law and make sure carriers it licenses are (EU)-owned and controlled. "Should the European Commission (EC) have doubts, we can make an inquiry and we can start an infringement procedure in the European Court of Justice against the respective government for failing to apply (EU) regulations."

Somewhat ironically, (HGA) announced a five-year cooperation agreement with AiRUnion (ZXD)/(DOD)/(OMK)/(SMR), Sukhoi and Russia's Bank for Development and Foreign Economic Activities. The deal calls for "a considerable increase in the number of [(HGA)'s] Russian routes besides retaining its existing direct Russian services" through both the addition of new services and codeshares with partner carriers. The airline added, "In the medium term, it is essential for (HGA) to upgrade its regional fleet, exchanging its current CRJs and Fokkers with new, modern jets." It said it is "examining" acquisition of Sukhoi's Superjet 100.

Sukhoi Civil Aircraft signed an agreement with (HGA) to build a Superjet 100 service and repair center in Hungary. (HGA) indicated it would consider ordering up to 15 of the new Russian-built 95-seaters. Thus far, Sukhoi has 70 firm orders for the Superjet, with first delivery scheduled for early 2008. The current sticker price is $28 million, but Sukhoi said it is working on both smaller and larger models, according to the "Russian News and Information Agency." "Confirmed orders from Russian air carriers have filled our Superjet 100 production capacity for 2008 to 2009, about 50% for 2010 and partially for 2011," CEO, Mikhail Pogosyan said.

To complement a network of flights to Western Europe, that (HGA) hopes to manage to hold on to, (HGA) is planning to now develop services to destinations in the much safer market of Eastern Europe, where safety and corruption standards are not overseen by the European Commission (EC). There is current market speculation that (HGA) is seeking to replace its existing fleet to much cheaper Russian airplanes, alongside 737 airplanes.

Major layoffs of Hungarian staff, announced earlier this year, are in progress, affecting a significant number of (HGA) employees, with company morale at an all time low. Not including the layoffs, (HGA) says it is expecting its 2007 cost saving to total -HUF 1.3 billion, with a +HUF 900 million increase in revenues.

(HGA) airlines operates out of Budapest airport, which puts passengers at risk, due to corrupt security. Passengers to and from Hungary through Budapest airport, do so at their own risk and must suffer the consequences of theft or other complaints at the airport without recourse. Hungarian police do not respond to victims who open police cases, and the airport has no apparent complaints procedure.

The European Commission (EC) contacted Hungarian authorities regarding the control and ownership of (HGA), after it was sold to Russian tycoon Boris Abramovich. Several mysterious replacements of top management have taken place in recent months. Budapest airport has exchanged hands several times in recent years, and is currently owned by HochTief.

(HGA) has in the past been plagued by frequent sabotage, and failed to adequately investigate the crash or shooting down of one of its airplanes.

January 2008: 2007 statistics: 4.49 billion (RPK)s passenger traffic +9.5%; +4.4% capacity (ASK)s; +3.3 load factor for 69.9% LF. SEE ATTACHED COMPARISON CHART TO SELECTED OPERATORS - "HGA-2007-STATS."

Malev Hungarian Airlines (HGA) sold three CRJ-200s to Alma de Mexico and one CRJ-200 to Nova Air (PMO), which is based in Mexico City.

February 2008: Malev Hungarian Airlines (HGA) will shift its entire Moscow operation to Domodedovo from Sheremetyevo from March 30. Malev (HGA) will adjust its timetable to fit with partner AiRUnion (ZXD)/(DOD)/(OMK)/(SMR)'s schedule.

April 2008: Airstream International Group arranged the sale and leaseback of two F 70s and a related spare Rolls-Royce (RR) (Tay 620-15) engine. The airplanes are operated by Malev Hungarian Airlines (HGA). The airplanes and spare engine were purchased by Gladiator Leasing.

May 2008: Malev Hungarian Airlines (HGA) restarted its five-times-weekly, Budapest - Toronto service aboard a two-class, 767-300ER.

July 2008: Malev Hungarian Airlines (HGA) will cancel its loss-making long-haul service from Budapest to New York (JFK) and Toronto (YYZ) this fall and withdraw two 767s from its fleet. The last flight to (YYZ) departs September 21, and the final (JFK) service will be October 25, ending the carrier's North American presence. "The major hike in expenditure makes it completely unviable for an airline the size of (HGA) to operate long-haul services economically," it said, adding that it intends to focus its resources on its European network, especially Eastern Europe, and strengthening its regional market share. It continues to restructure its fleet through the addition of secondhand DHC-8-Q400s that will enter service this winter and gradually will replace CRJs and F 70s starting in December 2009.

(HGA) said it reached an agreement with Bombardier to acquire four used DHC-8-Q400s for introduction into service with the 2008 to 2009 winter schedule. Subject to completion of a final contract, (HGA) will purchase four new DHC-8-Q400s with delivery from 2012 and take options on an equal number. (HGA) put the value of the new firm airplanes at approximately $113 million, rising to $226 million if all options are exercised.

August 2008: Malev Hungarian Airlines (HGA) said it will remove five 737s from its fleet during the winter schedule and lease them to other carriers. It will not remove any European or Middle Eastern destinations from its network, but the fleet rationalization, which includes the previously announced grounding of its two 767s and the suspension of its North American service, will result in the layoff of approximately -250 active employees and a further -150 "in a legal working relationship" with the company, or -21.6% of the workforce. "The company considers the costs associated with the layoffs to be an investment with a return period of less than one year," it said. "Malev (HGA) has the financial resources at its disposal to implement these measures."

October 2008: Malev Hungarian Airlines (HGA) ended flights between Budapest and Toronto last month and is scheduled to operate its final westbound transatlantic flight from Budapest to New York on October 25. (HGA) will continue to market flights to the USA under its own code through an expanded code share with American Airlines (AAL). The decision to end its own long haul flights will enable Malev (HGA) to remove one 767-200ER and one 767-306ER (28884) from the fleet. As part of its restructuring, (HGA) is also returning 2 737-600s, 2 737-700s, and 2 737-800s to (ILF) and reducing its workforce by -20%. It also disposed of its last CRJ-200.

December 2008: Malev Hungarian Airlines (HGA) took delivery of the first of four former (SAS) Group DHC-8-Q400s (HA-LQA). It plans to introduce four new DHC-8-Q400s beginning in 2012, replacing its F 70s and CRJ-200s. - - SEE ATTACHED PHOTO - - "HGA-DHC-8-Q400-2008-12."

January 2009: Malev Hungarian Airlines (HGA) will be taken over by Russia's state-owned Vneshekonombank owing to the "previous owner's weak management and the global financial crisis," Russian First Deputy Prime Minister, Viktor Zubkov said at a Budapest news conference. Aeroflot (ARO) will be (HGA)'s "strategic partner." (HGA)'s owner, the AirBridge consortium comprising Russian investor Boris Abramovich (of the defunct AiRUnion alliance) and two Hungarians, failed to fulfill certain obligations over the past two years, executives said, leading Hungarian Finance Minister Janos Veres to tell reporters, "The steps taken since the privatization have not been adequate to ensure the future of the airline." (HGA) has a €30 million/$38.9 million loan from Vneshekonombank. A shareholders meeting was scheduled following the recent recall of Abramovich as (HGA) Chairman. It was unclear how (HGA) will ensure that a European Union (EU) investor will hold a majority stake.

The (HGA) shareholders meeting was suspended until February 10, with (HGA) citing "the requirement to reach properly grounded decisions," including a possible reduction in the value of its shares. It confirmed that Russia's Vneshekonombank will be its "indirect owner" and that its operation will be "conducted in partnership with Aeroflot (ARO)." (HGA) said the state-owned bank "guaranteed" its "long-term financial stability." It claimed the ownership change affects 99.95% owner AirBridge and "does not have any impact on (HGA)'s status as a national carrier of Hungary or its (EU) carrier status."

(HGA) is late paying January wages to its employees and reportedly was able to distribute just HUF50,000/$217.68 to each worker, promising the remainder following an extraordinary general meeting concerning the carrier's takeover by Russia's Vneshekonombank. (HGA) said the reasons for the delay "are deteriorating economic conditions around the globe and in Hungary, (HGA)'s own difficult financial situation, and lower turnover and revenue as a result of the seasonality of air travel during the winter," according to a statement cited by "Reuters." Despite its precarious financial situation, (HGA) is "very well prepared for this crisis" and is flexible enough to adjust capacity as needed, CEO, Peter Leonov said at the Oneworld Alliance (ONW) anniversary event in Madrid.

February 2009: Aeroflot (ARO) and Malev Hungarian Airlines (HGA) will code share on each other's Budapest - Moscow Sheremetyevo services beginning March 29 and will offer a combined six daily flights.

(HGA) CEO, Peter Leonov resigned, the carrier confirmed following it's extraordinary general meeting. COO, Geza Fehervary will serve as temporary CEO while the company looks for a replacement, and Vneshekonombank Deputy Chairman, Ballo Anatoly Borisovich was elected Chairman. (HGA) shareholders also moved to reduce equity capital to HUF360 million/$1.6 million because the carrier's new ownership structure is not finalized. (HGA) said that may occur before a March 3 meeting, but that until it does Vneshekonombank will finance (HGA) through current owner AirBridge.

March 2009: Malev Hungarian Airlines (HGA) said parent company AirBridge has committed to a HUF3 billion/$13.1 million capital injection. (HGA) also said that the ownership structure of AirBridge has changed in order to maintain majority Hungarian control.

April 2009: Malev Hungarian Airlines (HGA) launched five-times-weekly, Budapest - Iasi flights, becoming six-times-weekly in June. Twice-weekly seasonal flights to St Petersburg will operate April 22 to October 21.

(HGA) named Martin Gauss, who has been working with the carrier as a consultant, as its new CEO. Geza Vehervary, who had been holding the position on an interim basis, will remain COO. Gauss was a 737 pilot (FC) at British Airways (BAB) subsidiary, Deutsche BA (DBA) in the early 1990s before entering management. He was named Managing Director of (DBA) in 2004 and remained in the post after its 2006 merger with Air Berlin (BER). He became CEO of Cirrus Airlines (STR) in October 2007 and left to become a consultant in June 2008.

June 2009: Malev Hungarian Airlines (HGA) said it expects its 2009 operating result to rise by HUF1.5 billion/$7.5 million over last year's, which it did not reveal, while flying approximately 3.1 million passengers. "We are going to make changes to the (HGA) fleet, schedule, commercial activities and headcount in the second half of the year," CEO, Martin Gauss said in a statement. "Together, these will enable us to improve our results this year against 2008. Furthermore, they represent the preconditions for profitability in the long term." (HGA) plans to return five leased F 70s, leaving the fleet comprised of 737NGs and Q400s. A fourth turboprop is scheduled to be delivered this month. It anticipates a 65.6% LF load factor in 2009, "similar" to 2008's, and said it hopes to double online ticket sales this year.

(HGA) said Russia's Vneshekonombank, which took over (HGA) in January, has provided a €20 million/$28 million loan that will enable it to add a third and fourth DHC-8-Q400 over the summer. Chairman, Anatoly Ballo said (HGA) has revised its 2009 business plan, which now "includes important steps to offset the crisis that are sufficient to bring (HGA) into a stable operational position."

(HGA) signed a letter of intent (LOI) at the Paris Air Show with SuperJet International for 30 Sukhoi Superjet SSJ 100s, a follow-up on its "cooperation agreement" signed in December 2007 with AiRUnion, Sukhoi Company and Russia's Bank for Development and Foreign Economic Affairs. The purchase outlined in the (LOI) has a potential value of up to $1 billion and will include support and pilot (FC) training. The two parties said they hope to finalize the purchase agreement before year end. (HGA) CEO, Martin Gauss said he's confident (HGA) will be able to find financing for the purchase, which will cover 15 firm orders and 15 options, despite the current economic environment and its own recent financial and ownership upheavals.

(HGA) will take the airplanes in a two-class configuration. Gauss said the airline is repositioning itself as a regional carrier operating a network of around 50 destinations that will include Moscow, Tel Aviv, Amman, and Madrid. "We will not do long-haul," he explained. "Those days are over." The Oneworld (ONW) alliance partner eliminated 767s from its fleet in November. Deliveries of the SSJs are expected to start in the second half of 2011.

There are 98 firm orders for the SSJ, excluding (HGA)'s (LOI). The airplane flew above the air show in its most visible public display to date.

DHC-8-Q402 (4057, HA-LQB), ex-(SAS).

July 2009: Malev Hungarian Airlines (HGA) launched twice-weekly, Budapest - Uzhhorod service.

August 2009: Super Jet International signed a Memo of Understanding (MOU) with Budapest-based, Aeroplex for Maintenance Repair & Overhaul (MRO) services to support Sukhoi Superjet SSJ 100s. If executed, the Malev Hungarian Airlines (HGA) subsidiary will join SuperJet's (MRO) network to provide SSJ 100 operators with line and base maintenance as well as unscheduled maintenance services and will have field teams to provide off-site support.

October 2009: The Hungarian government is preparing to provide financing or purchase a stake in Malev Hungarian Airlines (HGA), the Finance Ministry said. Minister, Peter Oszko met in Moscow with Russian First Deputy Prime Minister, Viktor Zubkov, according to press reports, after which the Hungarian Finance Ministry said, "Hungary indicated that in order to ensure continued operation of (HGA), it is ready to take an ownership or financing role in the national airline." Russia's Vneshekonombank holds 49% of Malev (HGA) owner, AirBridge. "The Russian government welcomed this position on the Hungarian side. The parties will hold further consultations," Hungary said. (HGA) said it posted a +13% year-over-year growth in September passenger traffic and an 80% LF load factor.

November 2009: Malev Hungarian Airlines (HGA) expects a final decision about its future ownership by the end of this month. (HGA) is in talks with the government, which is considering reinvesting in (HGA) and helping it restructure, Deputy CEO & CCO, Karim Makhlouf said. He said the government likely will acquire at least 51%. (HGA) currently is 99.5% owned by the AirBridge consortium, which is backed by Russia's Vneshekonombank. It was privatized in 2006.

Meanwhile, management is doing everything possible to stabilize (HGA), Makhlouf said. Its current fleet of 30 airplanes will be reduced to 20 for the winter season, with most of the remainder parked, and 30% of its 1,500 employees will be laid off. The fleet will rise back to 28 airplanes for the summer 2010 schedule. "Our plan is to increase the (HGA) fleet by three steps, up to 40 airplanes by 2012," he said. (HGA) plans to double its DHC-8-Q400 fleet to eight in the near future and remains committed to its letter of intent (LOI) for 30 Sukhoi Superjet 100s. "We will focus on extending our network in Eastern Europe, with the first enhancements on these routes starting in January." He said (HGA) made a mistake in not focusing on Eastern Europe in the past and has failed to derive maximum benefit from its Oneworld (ONW) alliance partnerships. It is looking to strengthen ties with Iberia (IBE), Finnair (FIN) and British Airways (BAB). "We also want to take advantage of the restructuring of Austrian Airlines (AUL) and (CSA) Czech Airlines. We believe we can react faster [in certain markets]," he said. Utilization is another key, and he said capacity additions will come largely through more efficient use of airplanes. (HGA) has suffered from load factors as low as 63% LF in the past, and also from a poor image, inefficiencies and carrying too many employees.

(HGA) will re-launch daily, Budapest - Serbia service December 14 aboard 72-seat DHC-8-Q400s after a 17-year hiatus. (HGA) suspended operations to Belgrade in 1992 owing to the outbreak of the Yugoslav wars.

December 2009: Malev Hungarian Airlines (HGA) expects to lose -HUF5 to -HUF7 billion/-$27.1 to -$38 million this year, reduced from -HUF10 billion in 2008, CEO, Martin Gauss told "Pester Lloyd." (HGA) is shooting for a profitable 2012.

January 2010: Malev Hungarian Airlines (HGA) transported 3.3 million passengers in 2009, up +6% from the prior year. (HGA) said a new pricing strategy designed to compete with Low Cost Carriers (LCC)s, group rate guarantees, a fivefold increase in corporate clients, new tourism packages and three new destinations accounted for the increase. CCO, Karim Makhlouf said he expects a double-digit gain in first-quarter 2010 passenger numbers.

February 2010: Malev Hungarian Airlines (HGA) withdrew its five F 70s from service and now is operating a fleet comprising 18 737NGs and four DHC-8-Q400s. The F 70s will be returned to (AWAS) (AWW) over the next six months. "This simplified fleet structure means a significant reduction in our company's maintenance and operational costs, the positive impacts of which will be apparent even in 2010," CEO, Martin Gauss said. As recently as 2008, (HGA) was operating a mixed fleet that included 767s and CRJ-200s.

March 2010: The Hungarian government reacquired control of its flag carrier, Malev Hungarian Airlines (HGA), spending HUF25.2 billion/$126.7 million on a 95% stake that will see (HGA) return to state control after three years as a privately held company.

The money-losing airline turned to the government for support last fall in the face of losses that reached -HUF10 billion in 2008 and were expected to narrow to -HUF5 to -HUF7 billion last year. The Vnesheconombank-backed AirBridge consortium had taken control of (HGA) in February 2007 and will continue to hold 5% of the carrier.

"The change of ownership is managed by a reduction in the equity of (HGA) and then a capital increase. Vnesheconombank remains one of the largest creditors . . . This means that its former ownership role is fundamentally changed to that of a creditor," the Ministry of Finance said. The government paid cash and converted old debt in order to acquire the stake. Martin Gauss will remain CEO.

"The majority holding of the Hungarian state has opened the way to the creation of financial stability for the operation of the airline. At the same time the ongoing, intensive restructuring program must be continued partly so that the financial rescue of the company consumes the minimum possible taxpayers' [money], and partly so that the European Union (EU) does not declare the role of the Hungarian state as banned state support," the Ministry said.

(HGA) this month announced a simplification of its fleet structure to comprise only 737NGs and DHC-8-Q400s and it has launched several pricing packages and initiatives designed to increase both leisure and corporate passengers. The government said that (HGA) still is targeting a 2012 profit and that "further tough measures can be expected . . . including, for instance, restructuring of the network, further layoffs, renegotiation of agreements with trade unions and renegotiation of supplier contracts."

It also will have to contend with opposition from Wizz Air (WZZ), Budapest Ferihegy's second-largest airline. (WZZ) said it was "outraged" by (HGA)'s renationalization and called for a European Commission (EC) investigation into what it called "clearly another case of illegal state aid" that "is discriminatory, distorts competition and provides no benefit to the consumer." (WZZ) claimed that (HGA) "is a non-viable business and will remain financially non-viable in the future."

August 2010: Malev Hungarian Airlines (HGA) CCO and Deputy CEO, Karim Makhlouf resigned from (HGA). Makhlouf, who joined Hungary's state-owned national carrier in January 2009, said it had been a “great experience to restructure this airline until this stage. ”Before joining (HGA), he was CCO of SkyEurope (SKP) and Director of Network Management at Hapag-Lloyd Express (HLX).

September 2010: Troubled Malev (HGA) received a HUF5.7 billion/$25.5 million loan from the Hungarian government, according to multiple news reports. Hungary's National Development Ministry, which officially extended the loan, told "Reuters" that "(HGA)'s situation would have become almost unsustainable" without the financial help.

The announcement of the loan came shortly after Figyelo, a Hungarian business publication, reported that (HGA) was unable to make airplane lease payments owed to (ILFC) (ILF). The Hungarian government already put HUF25.2 billion/$126.7 million into (HGA) this year. CCO & Deputy CEO, Karim Makhlouf resigned from the carrier last month.

Malev (HGA) said its restructuring of Malev Air Tours has been completed, including a -40% reduction in the subsidiary’s workforce over the past two years. The tour operator also reduced its expenditures by -34% year-over-year in 2009 and by -15% in the first eight months of this year compared to the prior-year period. "Consistently, step by step, we are carrying out the restructuring of (HGA) and its affiliates, one positive result of which is that this year, Malev Air Tours is now standing on its own feet," Malev (HGA) CEO, Martin Gauss said. (HGA), which recently received an emergency loan from the Hungarian government, expects its tour affiliate to be profitable for the full year.

October 2010: Malev (HGA) will operate summer 2011 seasonal service from Budapest to Heraklion (thrice-weekly, June 11 - September 24), Corfu (thrice-weekly, June 11 - September 24) and Burgas (twice-weekly, June 18 - September 17). (HGA) will increase Budapest service to Amman (twice-weekly to thrice-weekly), and Helsinki (nine-times-weekly to 12-times-weekly) from October 31.

November 2010: Malev (HGA) will relaunch service to Barcelona, operating four-times-weekly from Barcelona beginning March 27 for the summer season. It has not operated the service for 10 years.

December 2010: Malev Hungarian Airlines (HGA) named Marta Rona as Communications Director. Rona arrived from Omnicom Media Group's Hungarian subsidiary.

The European Commission (EC) is investigating Hungarian government support measures for Malev Hungarian Airlines (HGA) to determine if the financially troubled carrier received illegal state aid. In a statement on its website, the (EC) said it is looking into the possibility that (HGA) may have received preferential treatment including "several capital injections and shareholder loans."

In 2007, (HGA) was privatized after several unsuccessful attempts. In early 2010, (HGA) was repurchased by the state. The (EC)'s formal inquiry will look at several support measures taken by the government on behalf of (HGA). The regulators doubt "that (HGA) would have been able to obtain financing from the market on the terms conceded by the Hungarian authorities."

February 2011: Malev Hungarian Airlines (HGA) announced it will begin offering customers in Amsterdam the option of online check-in for departures. Beginning February 25, passengers will be able to input reservation and ticket info on (HGA)’s website up to 36 hours before departure and select a preferred seat. Online check-in is now available at 25 airports in (HGA)’s network, it said.

(HGA) said it will celebrate its 65th anniversary on March 26. A Bombardier DHC-8-Q400 is painted in retro colors and will operate from Budapest to Stuttgart, Prague, Varna, and Bucharest Otopeni. (HGA) operates 18 737NGs and four DHC-8-Q400s to 50 destinations in 35 countries.

March 2011: Malev (HGA) CEO, Martin Gauss resigned from his position after failing to reach an agreement on his compensation. His resignation will be effective from May 31.

Paul Coakley, Chief Technical Officer (CTO) and Otto Gergye, Sales Director.

Budapest Airport (BUD) on March 18 will formally open its new SkyCourt, linking its existing terminals 2A and 2B. The shell-shaped, glass and steel building will almost double the capacity of the terminal and should markedly enhance the passenger handling and travel experience by adding +28 new passenger security screening channels, +50 border crossing points, +21 boarding gates, +80 check-in counters, +16 self-check-in kiosks, and multiple retail outlets. The contemporary structure extends over five stories, two of which are underground, and offers an impressive view of the apron.

SkyCourt represents an investment of €70 million and is part of a €261 million, five-year expansion plan dubbed "(BUD) Future," which aims to position the airport as a key Eastern European hub. (BUD) Future is co-financed by the European Union (EU) and the airport's owner, Budapest Airport Zrt, a public-private partnership with the Hungarian state holding 25% and the remaining 75% owned by German company Hochtief AirPort and four financial investors. (BUD) Future also includes the construction of a "cargo city" comprising 140,000 sq m of cargo and logistics terminals designed for airlines, handlers and integrators.

The airport incorporates two terminals; T1 is a dedicated Low Cost Carrier (LCC) terminal, and T2 services traditional carriers. (BUD) is the base for Malev Hungarian Airlines (HGA) and is home to a further 32 carriers serving more than >92 destinations in 40 countries worldwide. It handled almost 8.2 million passengers through scheduled, charter and general aviation services in 2010, up +1.2% over 2009.

April 2011: SEE ATTACHED "AIRLINER WORLD" LATEST REVIEW OF MALEV (HGA) - - "HGA-2011-04-A/B/C/D/E/F/G/H/I/."

June 2011: Malev Hungarian Airlines (HGA) is making progress in its turnaround efforts, but still will not earn a profit this year, CCO, Otto Gergye said. he said profitability is likely "to happen in the next 18 to 24 months." He added that the Hungarian government has provided strong support to (HGA) to see it through fiscal distress. The government re-nationalized (HGA) in 2010, taking a 95% stake to enable it to avoid bankruptcy. The European Commission (EC) is investigating the propriety of the state help.

(HGA) is seeking an additional government cash injection of HUF18.5 billion/$97.25 million, according to the "Hungarian Daily Magyar Hirlap."

(HGA), which joined the Oneworld (ONW) Alliance in 2007, would like to use Budapest as its hub to connect (ONW) alliance passengers to secondary Eastern European destinations. But (HGA) doesn't believe the (ONW) Alliance is utilizing it as much as it could. "Budapest (BUD) is maybe the smallest hub in the (ONW) alliance," Gergye noted. "We see the possibility to generate hub traffic from the north to the south of Europe, not only east/west traffic."

(HGA) uses the (ONW) alliance to expand its reach since it does not operate its own long-haul flights. For example, (ONW) alliance partner American Airlines (AAL) operates (BUD) - New York (JFK) flights. "New York is our biggest market in the USA," Gergye said, adding that he would "never say never" regarding (HGA) restarting its own long-haul services.

The first priority, of course, is getting out of the red. "I think we are over the worst," Gergye insisted. "We are coming to the end of our restructuring." He is confident there are growth opportunities for the (ONW) alliance and (HGA) in the region.

Lorent Limburger, formerly the head of (HGA)'s ground handling unit, began serving as acting CEO of the airline June 1, replacing Martin Gauss.

(HGA) operates a fleet comprising six 737-600s, seven 737-700s, five 737-800s and four Bombardier DHC-8-Q400s.

July 2011: The Hainan Airlines Group is considering investing in financially troubled Malev Hungarian Airlines (HGA), according to an industry insider in China who said (HNA) is in negotiations with (HGA). If successful, (HNA) would become the first Chinese carrier to invest in a European airline.

(HNA) signed a Letter of Intent (LOI) with (HGA) to deepen its cooperation and sent a group to negotiate with (HGA). "(HNA) is in talks with (HGA) now mainly owing to the promotion [of cooperation between the carriers] by the Hungarian government and the Chinese government," said the source, who pointed out that it may take "at least four to five months" to clear all hurdles to complete a deal.

Interestingly, (HNA) Chairman, Chen Feng noted that (HNA) considered making a bid for (HGA) in 2004. Ultimately, (HNA) decided against the investment because (HNA) lacked a broad route network in Europe and it considered the financial risk too great.

September 2011: Malev (HGA) will relaunch 737-600 5X-weekly, Budapest - Tripoli flights service on October 23.

October 2011: Air Berlin (BER) and Malev (HGA) have reached a code share agreement beginning October 30 on routes to Budapest from Berlin Tegel, Hamburg, Stuttgart, Frankfurt, and Zurich. In a next step, both carriers plan to extend the cooperation to each other's frequent flyer programs.

December 2011: Malev (HGA) will get a HUF4.2 billion/$18.4 million owner loan to cover its short-term financing from the Hungarian National Asset Management Company. The three-year loan must be repaid in a single lump sum upon maturity.

Malev Hungarian Airlines (HGA) could face bankruptcy soon, the Hungarian daily "Vilaggazdasag" reported.

Hungarian Minister of Finance, Tamas Fellegi confirmed to Hungarian media that the Budapest government is holding talks with an investor from the Czech Republic to form a new carrier and a deal could be reached by the middle of next year. The investor is also owner of Czech leisure carrier Travel Service (TFS).

It was reported earlier that the Hungarian government was not willing to invest any more funds into (HGA). It has been evaluating whether to create a new carrier, in which 51% would need to belong to a European Union (EU) airline or investor.

The European Commission (EC) continues its investigation into whether (HGA) received illegal state aid from the Hungarian government between 2007 and 2010 totaling HUF100 billion/$455 million in capital injections, debt payoffs, loans and deferred tax obligations.

January 2012: Hungarian state-owned, Malev Hungarian Airlines (HGA) must pay back the equivalent of up to $350 million in illegal state aid between 2007 and 2010, the European Union (EU)'s competition watchdog said. The European Commission (EC) said (HGA) would not have been able to obtain similar financing from the market on terms granted by Hungarian authorities, and was unable to demonstrate how it would become viable under its current business model.

The (EC) statement listed various forms of state financing for (HGA), which totaled HUF64.1 billion/$258 million and €76 million/$97 million. But an (EC) official said it was up to the Hungarian authorities to define how much it would have to pay back.

"The (EC)'s investigation concluded that (HGA), given its consistently difficult financial situation, would have been unable to secure such financing on the market on the terms conceded by Hungary, nor possibly any financing at all," the statement said.

(HGA) Chairman, Janos Berenyi said (HGA) does not face immediate payment liability and its daily operations will not be affected because resources have been supplied by the company’s owner. The Hungarian government has informed (HGA) and the general public that it remains committed to maintaining the national carrier.

(HGA), which said its 2012 forecast has significantly improved, is showing strong performance indicators, achieving a load factor of 78% LF in December. In its fourth quarter (Q4) 2011, it boosted revenue by +HUF7 billion/+$30.7 million) compared to the year-ago period.

(HGA) has temporarily moved its Budapest - Varna service to Bourgas between October 15 and February 26 as Varna airport is closed for runway repairs.

Later, The Hungarian government put state-owned Malev Hungarian Airlines (HGA) into bankruptcy protection. (CEO), Lorant Limburger said that the company was running out of money.

Board Chairman, János Berényi has requested management to draw up a liquidity plan by the end of the week.

(HGA)’s board of directors has requested the owners do everything possible to resolve the situation, even though government intervention is extremely limited following a European Commission (EC) ruling earlier this year calling on (HGA) to repay the equivalent of up to $350 million in illegal state aid between 2007 and 2010.

A few days ago, an agreement was reached with International Lease Finance Corporation (ILFC) to continue to make their airplanes available for operations.

February 2012: Hungary’s 95% state-owned carrier Malev Hungarian Airlines (HGA) ceased operations, grounded all its flights and stranded more than >7,000 passengers, when its financial situation became unsustainable after its partners lost trust in the carrier and began demanding advance payments for their services. (HGA) with a fleet of 22 airplanes, is in bankruptcy protection and is desperately drawing up a restructuring plan in the hope of attracting an investor.

International Lease Finance Corporation (ILFC) flew back nine of its leased (HGA) 737 airplanes to its base in Ireland.

The government put the (HGA) into bankruptcy protection January 30. The government created a fund of HUF2 billion/$9.04 million for the thousands of travelers who would become stranded if the airline ceased operations.

“Unfortunately, the event occurred which we had a greatest fear of and we wanted to avoid . . . our partners lost their trust due to the information published in the last days and they started to ask for payment of their services in advance. This speeded up the cash outflow and the situation of the airline became untenable,” (HGA) said.

(CEO), Loránt Limburger said the owner was “unable to provide additional financial resources to operate after the (EU) decision” earlier this year calling on (HGA) repay the equivalent of up to $350 million in illegal state aid between 2007 and 2010.

(HGA) posted a loss of -$110 million in 2010. Hungarian Prime-Minister, Viktor Orban said in several media outlets that he wanted to rescue the financially troubled carrier and the state needed a functional home carrier. He said the decision to ground the airline came after two airplanes were not allowed to take off from Tel Aviv and Dublin because of its debts.

Meanwhile, several European carriers, such as Lufthansa (DLH) and Air Berlin (BER), have announced they will add services and frequencies to Budapest (BUD). (HGA) accounts for 40% of the annual turnover at Budapest Airport (BUD).

Wizz Air (WZZ) plans a substantial +66% capacity boost in Hungary in 2012 as a response to this (HGA) collapse. (WZZ) offered discount fares for Malév (HGA) passengers impacted by the suspension of the (HGA) operations, offering re-routing alternatives to/from Budapest (17 routes in total).

EasyJet (EZY) has also joined Wizz Air (WZZ) by stepping up with a rescue package for passengers affected by (HGA) suspending its flights. (EZY) will offer passengers stranded at their destinations, a special rescue fee of 60 euros to return home. The offer is available to any (HGA) passenger due to travel inbound until midnight on February 9. (EZY) operates on three former Malev (HGA) routes: London - Budapest, Paris - Budapest, and Berlin - Budapest.

Ryanair (RYR) announced last month that it will base four new 737-800 series airplanes at Budapest Airport (BUD) commencing on 17 February, when it will open 31 new routes.

Fleet:
(definitions)

Click below for photos:
HGA-737-4YO
HGA-737-6Q8
HGA-737-7Q8
HGA-737-800
HGA-CL-600-2B19
HGA-DHC-8-Q400-DEC08
HGA-F 70
HGA-F 70-1

February 2012:

0 737-2K9 (JT8D) (1176-23404, /85), EX-(MID), (BAV) LSD 1994-06, RTND (BAV), LST 2 (NCT), 1 TO (UKR).

0 737-3YO (CFM56-3C1) (1829-24676, /90 HA-LES; 2021-24909, /91 HA-LED; 2030-24910, /91 HA-LET; 2054-24914, /91 HA-LEF), (GEF) 3 YR LSD; 1973-24902, /91 HA-LEX; EX-(SAP), (GUI) LSD 2001-03. (2066-24916, /91 HA-LEG "SZENT ISTVAN-SANCTUS STEPHANUS"). 24676; 24910; RTND 2003-03, LST (NWG). 24909 RTND 2004-04, LST (NWG). 24914 RTND 2004-07. 24916 RTND 2004-10. 123Y.

0 737-3Q8 (CFM56-3C1) (2635-26303, /94 HA-LEJ), (ILF) LSD, RTND (2004-04). 129Y.

1 737-4Q8 (CFM56-3C1) (2482-26290, /93 HA-LEZ; EX-(PGS), 162Y.

0 737-4YO (CFM56-3C1) (1988-24904, /91 HA-LEV; EX-(THY); 2256-25190, /92 29 12, HA-LEU; 2352-26069, /92 HA-LEN; 2361-26071, /92 HA-LE0), (GUI) 3 YR LSD 2000-05, EX-(HCY), (GEF) LSD 2001-03 (1824-24682, /90 HA-LEY). 25190 RTND 2003-03. 26071 RTND 2003-11. 24904 RTND (DEA) 2004-04. 26069 RTND (GEF) 2004-05. 143Y.

0 +3 OPTIONS 737-5K5 (CFM56-3C1) (1848-24776, /90 HA-LEP; 1966-24926 HA-LOR; 1968-24927; 2022-25037; 2044-25062), EX-(HAP), 5 YR LSD, 24776 RTND (HAP) 2003-11. 24926 RTND 2004-02. 111Y.

9/6 ORDERS 737-600/-700/-800, (ILF) LSD:

4 737-6Q8 (CFM56-7B20) (1379-28259, /03 HA-LOD; 28260, /03 HA-LOE; 1437-28261, /04 HA-LOG; 29348, /03 HA-LOF; 1455-29349, HA-LOJ, 2004-02; 1508-29353, HA-LON, 2004-05), (ILF) LSD. 2 RTND 2008-10.

6 737-7Q8 (CFM56-7B20) (29234, HA-LOP; 29235, HA-LOR; 1283-28254, /03 HA-LOA; 1264-29346 /03 HA-LOB; 1452-29350, 2004-02 HA-LOI; 29352, 2004-04 HA-LOL; 1581-29354, /05 HA-LOP, 2004-10; 1609-29355, HA-LOR 2004-11; 1659-29359, /05 HA-LOS; 30682, /05 HA-LOS NTU; 30684, HA-LOU; 32797, HA-LOC), (ILF) LSD. 2 RTND 2008-10. 119Y.

3 737-8Q8 (CFM56-7B26) (1287-32797, /03 HA-LOC; 1448-30667, 2004-02 HA-LOH; 30669, 2004-04 HA-LOK; 1497-30672, HA-LOM 2004-05; 1689-30684, /05 HA-LOU), (ILF) LSD. 30667; WET-LST (LDA) 2006-04. 2 RTND 2008-10. 30684; IN "ONEWORLD" TITLES SEEN 2011-10. 180Y.

0 767-27GER (CF6-80C2B4F) (475-27048, /93 HA-LHA; 482-27049, /93 HA-LHB), FOR SALE. WILL OPERATE UNTIL 2007-08. 197Y.

0 767-3P6ER (CF6-80C2) (260-24484, /89 HA-LHD, NTU), SAMA LSD 2000-08, EX-(GUL), RTND 2001-10, LST (LOT). 197Y.

0 767-306ER (CF6-80C2B6F) (738-28884, /99 PH-BZM, 2007-03), EX-(KLM), (ILF) LSD. RTND 2008-10, LST (SBR). 36C, 188Y.

4 BOMBARDIER DHC-8-Q400 (HA-LQA - - SEE ATTACHED PHOTO - - "HGA-DHC-8-Q400-2008-12;" 4057, HA-LQB, 2009-06), EX-(SAS).

0 CRJ-100ER (7032, HA-LNX), BOMBARDIER LSD 2002-07, RTND 2002-10.

0 CRJ-200ER (CL-600-2B19) (7676, HA-LNA; 7086, HA-LNB, 2002-09), 3 ST ALMA DE MEXICO & 1 TO (PMO) 2008-01. 50Y.

1 +3 ORDERS ATR72, TO REPLACE F 70'S.

1 B AE 146-200QT.

0 F 70 (TAY 620-15) (11564, /95 HA-LMA; 11565, /96 HA-LMB; 11569, /96 HA-LMC; 11563, /95 HA-LMD; 11575, /96 HA-LME; 11571, /96 HA-LMF), (ILF) LSD, 1 VIP (11571), 11563 RTND, LST (KLM). ALL FIVE APLS WFU 2010-02. 67Y.

15/15 ORDERS (2011-07) SUKHOI SUPERJET SSJ 100, TWO CLASS:

0 TU-154B-2, GROUNDED, ALL RETIRED 2001-03, 5 SOLD.

2 YAK 40.

Management:
(definitions)

JANOS BERENYI, CHAIRMAN (2009-02).

LORANT LIMBURGER, ACTING CHIEF EXECUTIVE OFFICER (CEO) (2011-06).

MARTIN GAUSS, CHIEF EXECUTIVE OFFICER (CEO), EX-(STR)/(DBA)/(BAB) (2009-04), RESIGNED (2011-05).

CAPTAIN GEZA FEHERVARY, CHIEF OPERATING OFFICER (COO) (2009-04).

OTTO GERGYE, CHIEF COMMERCIAL OFFICER.

LASZLO SANDOR, PRESIDENT (2003-05).

PIOTR IKANOWICZ, CHIEF FINANCIAL OFFICER (CFO), EX-(LOT) (2007-06).

PAUL COAKLEY, CHIEF TECHNICAL OFFICER (CTO) (2011-02).

ANTAL PONGRACZ, GENERAL MANAGER (2000-01).

MARTA RONA, COMMUNICATIONS DIRECTOR (2010-12).

OTTO GERGYE, SALES DIRECTOR (2011-02).

CAPTAIN GABOR PULICS, DIRECTOR FLIGHT OPERATIONS (BUDOZMA) (2002-12) (pulics.gabor@malev.hu).

CAPTAIN JANOS KESZOCE, 737 CHIEF PILOT.

CAPTAIN JANOS BOROVSZKY, 767 CHIEF PILOT.

KAROLY MARTENYI, FLIGHT SAFETY SERVICE OFFICER (BUDDSMA).

VIKTOR HAJSO, ENGINEERING & MAINTENANCE DIRECTOR (BUDNTMA) (2001-12), (hajso.viktor@malev.hu).

ANTAL PEKK, DIRECTOR QUALITY & SAFETY.

MS MARTA RONA, DIRECTOR COMMUNICATIONS (2010-12).

ZOLTAN MESTER, CHIEF OFFICER INFRASTRUCTURAL & PORTFOLIO MANAGEMENT (2007-06).

JOZSEF VANCSIK, COMPANY SECURITY MANAGER.

IMRE KURUCZ, ENGINEERING DEPARTMENT MANAGER (kuruczi@malev.hu).

BALANT NAGY, MANAGER FLEET DEVELOPMENT PROJECTS.

JOZSEF KRAJLIK, MANAGER MAINTENANCE CONTRACTS (2000-09).

ZOLTAN TELEPOCZKI, MANAGER ENGINE PROJECTS (2000-09).

ISTVAN SIPOS, SECTION MANAGER BOEING ENGINEERING.


THE FOLLOWING ARE AEROPLEX OF CENTRAL EUROPE (APX):
(marketing@mail.aeroplex.com).

TIBOR BESENYI, MANAGING DIRECTOR (BUDNTMA), (tbesenyi@mail.aeroplex.com) (2001-05).

ZSOLT POPRADI, TECHNICAL DIRECTOR (2003-03) (popradizs@mail.aeroplex.com).

PETER JUHASZ, QUALITY CENTER DIRECTOR (2003-03).

ANDRAS SEBOLT, FINANCE DIRECTOR (2003-03).

ILLES SZEMAN, LOGISTICS CENTER DIRECTOR (2001-10).

LASZLONE ARADI, INFORMATION CENTER DIRECTOR (2001-04).

LORANT LIMBURGER, DIRECTOR GROUND OPERATIONS (2000-04).

SANDOR HERPAI, AIRLINE TECHNICAL SERVICE CENTER DIRECTOR (2001-04).

JOZSEF PAP, MANAGER ENGINEERING (BUDNTMA) (papjo@mail.aeroplex.com).

GYORGY BENEDEK, MANAGER BASE MAINTENANCE (2002-12).

JANOS MILNAR, MANAGER PRODUCTION CONTROL (2002-12).

ATTILA ARATO, MANAGER LINE MAINTENANCE.

MIKLOS KERTESZ, MANAGER MAINTENANCE PLANNING (1999-01),
(100324.3436@compuserve.com) (BUDHE7X).

GYORGY BENEDEK, MANAGER BASE MAINTENANCE.

ISTVAN SZABO, MANAGER INFORMATION SERVICES & ENGINE PROJECT.

ZSUZSANNA ARADI, MANAGER INFORMATION TECHNOLOGY (IT),

GEZA JARMAY, COMPONENT MAINTENANCE DEPTARTMENT MANAGER (1999-07).

GYORGY UJLAKI, SECTION MANAGER BOEING ENGINEERING.



THE FOLLOWING ARE LUFTHANSA TECHNIK BUDAPEST (LTB):

PETER ELLISON, MANAGING DIRECTOR (peter.ellison@lhtb.hu).

ZSOLT NAGY, HEAD TECHNICAL SERVICES (zsolt.nagy@lhtb.hu).

JANOS RACZ, HEAD QUALITY & TRAINING (janos.racz@lhtb.hu).

MICHAEL MALONE, HEAD PRODUCTION (michael.malone@lhtb.hu).

 
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