[WATCH] Air Malta rebranding tagged at €1.9 million

Air Malta's rebranding has cost €1.9 million, chief executive Peter Davies said this morning at a business breakfast marking the airline's newly-launched logo and livery.

The event, dubbed 'Flying the Pride of Malta', saw Air Malta relaunch the airline's brand in a bid to propel the company to financial sustainability.

The new rebranding exercise comes a week after Air Malta chairman Louis Farrugia announced losses at Air Malta of €30 million.

Addressing the event, Farrugia described the event as a "milestone" and said it is just the beginning of a long-term plan to reposition the airline's identity and make it "100% Maltese."

Earlier this year, Air Malta revealed that it had engaged the services of FutureBrand to rebrand the company, with controversy ensuring over the lack of a public tendering call.

Davies said the money invested in the rebranding would be recouped within two years.

Consultants FutureBrand were paid €400,000 while painting the aircraft and producing the new merchandise will cost €1.5 million. The first five planes will be ready with their new colours by November, the rest by March 2013.

The 'Air Malta' logo will now be featured simply as 'malta' - highlighting the country prominently on the aircraft.

Davies said the airline's rebranding was included within the restructuring plan that was approved by the European Commission.

However, he said that any new routes by the airline were restricted in part by the restructuring plan's conditions, when asked by

The 'Air Malta' logo on the aircraft will now be featured simply as 'malta' - highlighting the country prominently on the aircraft.

Davies said the airline's rebranding was included within the restructuring plan that was approved by the European Commission.

However, he said that any new routes by the airline were restricted in part by the restructuring plan's conditions, when asked by MaltaToday whether Air Malta will be adding new routes to serve as a regional hub to other nearby destinations.

"We have restrictions due to the EU restructuring plan in expanding our route network inside the European Union. We cannot expand on any new routes until the airline becomes profitable, but we are free to open new routes outside the EU.

"Russia is one of the new markets we are looking at. We cannot stand still, and the airline is always looking at expanding its reach."

FutureBrand is part of the MCCann World Group, a multinational marketing company, having offices in over 25 countries worldwide.

ALPA, the pilots' association, said last week it would boycott the Air Malta rebranding event.

The pilots' association said it felt feels that such expenses are highly inappropriate and these funds could have been put to better and more productive use. Given this scenario ALPA instructed all its members not to participate in this event."

Asked to give his reaction, Davies said he preferred to talk about the body of pilots as a whole rather than ALPA because the majority of pilots were enthusiastic about this change.

The Air Malta CEO stressed the importance of motivating employees for the change the airline is going through. "This is a momentous day in terms of moving the company forward. It is vital for all employees to be ready to adopt to these changes."

Davies explained that financial results for the first quarter of the current financial year will soon be published and added that Air Malta is on track to achieve its target of reducing losses to €15 million.

As part of its restructuring programme, which was given the green light by the European Commission, Air Malta plans to break even by 2014 and return to a state of profitability by 2015.

Davies said that in June 2011 Air Malta spent €1.25 for every €1 it earned but this has since dropped to €1.14. The airline aims at further gains by reaching  €1.07 by the end of the current financial year and bring it down to 95c by 2015.

Prime Minister Lawrence Gonzi, who unveiled an Airbus model displaying Air Malta's new colours and brand identity, said the event "reflects the individual and collective pride which is deeply rooted in our desire to succeed and move forward."

He added that Air Malta plays a vital part in ensuring the country's accessibility and said "this rebranding exercise reinforces the role and meaning Air Malta has."

Finance minister Tonio Fenech stressed the importance of the airline to Malta and said it plays a central role in the country's development.

"Malta needs Air Malta to be on its feet to continue generating economic growth and jobs."

Fenech added that the rebranding exercise reflects the culture, heritage and hospitality of Malta.