Israel’s air travel markets benefit from liberalisation, but El Al is losing out to LCCs: Part 1

Israel's air travel market seems to be attracting attention. In recent weeks, there have been headlines about new routes from Vueling, TAROM, Arkia, Transavia, Jetairfly, Wizz Air, Yan Air, Med-View Airline, easyjet-u2" title="More information on easyJet">easyJet, Meridiana, Serbia">Air Serbia and Air Onix; and increased frequencies by TAROM, Norwegian, easyjet-u2" title="More information on easyJet">easyJet, El Al, Alitalia, Lufthansa and airberlin.

Following the signing of an EU-Israel open skies agreement in 2012, a factor in increased services from the EU, countries including Russia, the Philippines and Kenya are also considering developing new air services agreements with Israel. In addition, a security-related restriction on Israeli carriers operating to Turkey (one of the few major aviation markets outside Europe">Western Europe and the US that has links to Israel) looks set to be lifted.

For a country of above average levels of wealth, as defined by GDP per capita, air travel penetration is also high, but lower than for other similarly wealthy nations. The Israeli market has generally seen healthy growth in recent years, but this has been uneven. Israel has significant potential for the airline industry, but its realisation will continue to be subject to politically-driven developments on traffic rights.