Israel aviation: invigorated by EU open skies – but not El Al
On 14-Jun-2019 El Al launched a weekly service from Tel Aviv to Las Vegas, operated by new Boeing 787-9 aircraft. The launch to the US city known for its casinos is another throw of the dice in a calculated gamble by Israel's biggest airline to restore profitability and counter ever growing competition.
El Al lost USD52 million in 2018, in contrast to a small profit of USD6 million in 2017, and its 1Q2019 loss widened to USD55 million from USD44 million a year earlier.
Passenger numbers were flat in 2018, when El Al's share of traffic at Tel Aviv Ben Gurion fell to a new low. However, it is fighting back, with new routes launched this year to Nice, San Francisco, Manchester in addition to Las Vegas. A summer route to Orlando is planned and, in 2020, it plans to launch Chicago and Tokyo.
The problem for El Al is that its local competitors, Israir Airlines and Arkia Israeli Airlines, are growing much more rapidly.
Arkia, the launch operator for Airbus' long range A320neoLR, is in a particularly expansive mood currently. Moreover, foreign LCCs, led by Wizz Air, easyJet, Pegasus and Ryanair, continue to grow their share of seats to/from Israel. The Israel-EU open skies agreement, progressively implemented between 2013 and 2018, has certainly invigorated Israeli aviation markets.
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