Malév Airlines: Market Failure

Malév Airlines: Market Failure

Introduction

Every year, hundreds of companies are being formed all over the globe. Some companies fall under the category of 'Small and Medium Enterprises' whereas some get categorized as a multinational company or a conglomerate. With the rise in business studies, entrepreneurs are rising all over the world. The preference to start a self-owned business has overtaken the trend of working as an employee. Not all businesses that get formed have the potential and capability to survive in the cold and cruel markets. Many businesses do not make it past the first year and fail miserably. Others manage to sustain themselves for a couple of years but then fail. Only a few businesses make it to the top and become a true part of the business world.

A market failure is the failure of a business to carry out a desired strategy in the market. This could be in terms of finances, growth, marketing or the launch of a new product that does not get accepted by the public. Any move by a company or a business that does not get accepted by the customers and backfires on the company is called a market failure.

Malév Hungarian Airlines

Looking at some of the most prominent and recent market failures, Malév Airlines definitely falls under the spotlight. Known as the Malév Hungarian Airlines, it was the flag carrier and primary airline of Hungary from 1946 to the year 2012. It had its head office in the Lurdy House of Budapest and operated mainly from the Budapest Liszt Ferenc International Airport. The airline operated in more than 50 cities in over 34 countries and possessed a fleet of 22 aircrafts at the time of liquidation.

On the 3rd of February, the company grounded all of its aircrafts and cancelled all its flights. ...