El Al has recorded quarter after quarter of record profits as most foreign airlines stay away from Israel.
All airlines have pricing algorithms that drive prices up when demand goes up. Is El Al gouging? I don’t think that’s the case, but obviously, it can charge much more when it has such a dominant market position.
North American carriers Air Canada, American, Delta, and United have remained on the sidelines. Yes, they would like to fly to Israel and take their share of the profits. However, unionized crews have refused to fly to a war zone, let alone overnight there, insuring planes can be difficult, and frequent cancellations have wreaked havoc with even planning a return date to Israel. Airlines are canceling Israel flights further out and suspending service indefinitely so they don’t tie up aircraft that could be better utilized on new routes.
Tech leaders in Israel are unhappy about the cost of El Al flights as well as the lack of seat availability and are looking for other options.
Of course, that demand of Israel’s flag carrier is a catch-22. If El Al would lower the cost of flights below what the pricing algorithms calculate to be optimal for the market to bear, it would create artificial scarcity and make finding available seats even more difficult than it is today. That would lead to even more complaints about seat availability, which is why El Al finds itself in a no-win situation as it reports record profits. Sure, it could technically lower prices below the market rate, but doing so would create an artificial scarcity of available seats which would be trading one problem for another.
Israel’s Channel 12 reports that with backing from Israel’s tech sector, Arkia and Israir have received government approval to operate 10 weekly flights between the US and Israel.
Israir last operated between the US and Israel in 2008.
Arkia had planned to purchase, and even configured 2 Airbus A330-900neos in Toulouse to operate flights between the US and Israel, but that never came to fruition.
As it stands now, neither airline has any widebody planes or crew that can fly a widebody, so they would have to wet lease them from an operator abroad, with crew from that operator.
I am deeply skeptical about whether they can pull that off.
El Al has been able to operate consistently because their crew is based in Israel.
Finding a European crew willing to fly to Israel and stay overnight in Israel as will be needed to operate nonstop flights between the US and Israel, will be very difficult if not impossible. And even if it can be done, the crew will balk at flying to Israel when tensions rise, which is why almost no European airlines are currently flying to Israel.
Arkia and Israir have struggled operationally this year in large part due to wet-leased aircraft and operators that have balked at times about operating to Israel, even when their crews aren’t overnighting in Israel. That will be exacerbated if they try replicating that with long-haul routes on widebody planes with overnighting in Israel.
In order to operate, Arkia and Israir are demanding that Israel pause its Aviation Services law which requires airlines to compensate passengers for delays and cancelations. That shows their confidence in being able to operate effectively in the current environment.
And with El Al selling their flights between the US and Israel at nearly full flight loads, it will be a challenge to accommodate stranded passengers or for passengers to find another way back in case of delays or cancelations.
Arkia and Israir would also have to ramp up customer service lines to deal with that kind of influx. And if you think El Al’s website is stuck in the past, just try using the Arkia or Israir websites…
The real solution to the capacity issues will be the return of foreign carriers and especially the North American carriers, but that seems unlikely to happen until the multifront war concludes.
Do you think the Arkia or Israir flights will come to fruition? Will you book travel on them?
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71 Comments On "Can Arkia Or Israir Break Up El Al’s De Facto Monopoly On Nonstop Flights Between The US And Israel?"
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El Al has wetleased from KlasJet based in Lithuania for short distance European flights. The flight crew temporarily relocated to Tel Aviv. Perhaps Arkia or Israir can work with KlasJet
Post 10/7?
Yes! I was supposed to fly from Prague to Tlv on August 1. They changed the aircraft to the KlasJet flight so I switched my flight time so as to be on an actual Elal plane. And then I cancelled the whole thing
Yes! Many elal flights are operated by KlasJet as a flight to a Greek island I’ve recently saw
https://klasjet.aero/klasjet-expands-partnership-with-el-al/
Seems like 737 only, so can’t fly across the Atlantic.
https://klasjet.aero/fleet/
I’m sure you heard of the charter flights there were on tishrei back and forth from New York ללכת although that was not a flawless
They used 772 from the 2000s operation it was Eastern it was a very good alternative for a very reasonable price
Having said that I wish they would continue this but why can a different Jewish organization for travel agency not arrange charters like they did
If it was successful, why did it stop?
On an article in the “Ami magazine” they said that’s a big hassle and that they’re not interested in continuing it
Exactly my point. It’s easier said than done!
Rumors are that arkia is working on a relationship with Eastern, the ceo or one of the higher-ups in eastern are Israeli.
But their planes are really more similar to a egged bus than to a actual plane, but they are in the works of retrofitting
They better. We need lower priced options.
If Lalechet can do it why can’t they ?
And are they still operating?
The logistics involved in keeping it going successfully are oppressive.
Thank you Dan for presenting a clear eyed approach to the El Al pricing catch-22! As you said, it’s basic economics; if El Al were to lower its prices below market rates then seats would be snatched up as soon as they open up (likely by eagle-eyed DDFers 😉 ) and people who really needed to fly wouldn’t be able to. For some the reason the rest of the Jewish/Israeli media forgot (or never learned) Econ 101. Dan, I think it’s time for you to start blogging on current events full time! We need more of your balanced perspective.
Pleasure, thanks!
Maybe one day…
I don’t think it’s so much of a availability issue, if you work with a travel agent they’ll be able to get you a seat, but for enormous costs, the reason is that travel agents keep all seats locked up using a couple of techniques.
Friends Don’t Let Friends Fly Arkia… Please save yourself the aggravation…
Don’t trust me. Check this out
https://www.tripadvisor.com/Airline_Review-d8729023-Reviews-Arkia-Israel-Airlines
And מחלל שבת
To answer your question, simply 100% absolutely
Good article, one point you forgot to mention is that the EL Al planes give some confidence that they have a missile defense system onboard. I think during wartime, especially, some would have less confidence flying on planes without these defenses into Israel. and a worst case scenario is perhaps, without that some might even be targeted.
I realize not everybody thinks about the above, but I have always had a sense that ElAl is the safest way to fly there. Especially these days.
That’s because El Al’s 787s do not have a missile defense system onboard, only the 737s and 777s do.
Boeing wanted too much to retrofit Dreamliners for the system.
Interesting.
Sky shield, the missile defense system used by Elal, was never equipped on most of the fleet including 777s and 737s, it was developed and installed on very few aircraft by Rafael an Israeli company, in collaboration with the IAF, not Boeing
I heard from the top that they blamed Boeing for the lack of SkyShield on the 787.
I wonder how many frum or at least israeli flight attendants work for foreign carriers who would be willing to do OT or something for arkia or israir… im sure some israelis would be willing to work as a flight attendant.
You can’t work for 2 airlines.
Lol I believe israir is owned by elal
Fake news.
It’s owned by Israeli millionaire Rami Levy
Flew Arkia for the first time today from Budapest to TLV. Their website is the worst I have ever experienced. Very limited English on the website, and zero way to figure out how to access my reservation. Seems that unlike other airlines that use a 6 digit alphanumeric confirmation number, Arkia uses a 7 or 8 digital numerical “order number”, which you receive by email ONLY IF YOU MAKE THE RESERVATION DIRECTLY ON THE ARKIA WEBSITE. I made reservation through Amex Travel (by phone- cuz Arkia doesn’t show on the Amex site), so I never got that order number, so zero way to find my reservation.
Also, when trying to check in, for some reason you need to put in name, reservation number, flight date, and departure airport (chosen from a drop down menu), and Budapest wasn’t even in the drop down menu. Lol.
When I finally got to Budapest and ran to the ticket desk, service was great and within seconds I had a boarding pass. I commented about the drop down menu and the agent laughed and admitted it’s insane that BUD doesn’t show online when they operate the flight daily.
Even though Arkia is known as a “Spirit” type low cost carrier, I had no problem boarding with a small Samsonite rollerboard Underseater and a regular size backpack without having to pay anything extra. They did offer on board water for free, but soft drinks and coffee were $3.
Plane was mostly empty, and I had my whole row to myself. Legroom was spirit-like, but flight was smooth and uneventful. There were no seat back screens of course, nor plugs by any seats.
I cannot imagine this airline working for english speaking Americans without major frustrations, unless they seriously revamp the website, check in system, and have their flights bookable through online travel sites. Obviously they will need bigger and better equipped planes to travel such long distances too.
The 7-8 digit order number is common in Japan too. It makes no sense. Must be an anachronism from some legacy software that refuses to die.
Right now only Delta and Emirates fly direct to Athens and connecting flights are not great. Since Delta and El Al are already partners, the solution here would be for Delta to increase flights to Athens by 1 or even two flights a day and El Al essentially run a shuttle service where likely two short haul planes wait in Athens to meet each flight and complete the hop to Israel. This could be done as a code share and their would be straight luggage transfers.
Would be nice, but Delta is actually pausing the JFK-ATH flight from 1/4 until 3/9.
Getting a US carrier to operate JFK-ATH-TLV with crew based in ATH would be ideal, but none of them seem to want to do that.
Not sure where Delta is deploying the long haul plane that does the ATH right now, but this would create the winter demand on JFK-ATH that easily would justify keeping the route going through March. In fact, I think it could create 2x daily demand easily.
Do you think it would be feasible to do a refueling stop along the way. Maybe tlv-dublin-nyc
For what benefit?
So they can use smaller planes
Dan it seems like you are putting the evil eye on this proposal.
Uh, nope.
Just asking the tough questions that nobody else is addressing.
Why can’t one of the smaller carriers work out an agreement To fly the one hour to LCA And then direct from there via (United) to New York. And it will be the whole plane that switches airplanes So if there’s a delay , plane would wait. I understand that’s not direct, but it’s pretty close
The logistics of that would be very tough. And small carriers don’t have the lift to fill a 787 from LCA-NYC.
Elal may not be able to do anything about the flight pricing and seat availability (as you explained, thank you) but they should still be able to hire more customer service agents and be more customer friendly. Two nights ago I tried to contact Elal through the whatsapp number (it was daytime in Israel) and got a “How can I help you?” ELEVEN hours later, like it was normal. When I complained, the rep said sorry they have over 2000 people in queue. Something is wrong there.
Agreed, they absolutely should be reinvesting in IT and customer service.
No excuses!
Israeli customer service is an oxymoron. It doesn’t exist here anywhere.
And that’s why El Al will lose market share to Delta and United when they return.
They have a unique opportunity now to lock in loyal passengers, but I’m not sure they’re doing what they need to.
Why doesn’t Elal just buy more aircraft with all these profits?
1. It takes years to get a new widebody plane. They were able to get 1 new one from Air China that they resold to them brand new. And they have ordered more, but it will take time:
https://www.dansdeals.com/points-travel/airlines/el-al/inside-story-el-al-decided-remain-boeing-carrier-largest-ever-aircraft-order/
https://www.dansdeals.com/points-travel/airlines/el-al/inside-story-el-al-decided-remain-boeing-carrier-largest-ever-aircraft-order/
2. They don’t have more slots to add flights in airports like JFK.
3. They don’t have the crew needed to operate more flights.
I was about to say the biggest issue even if everything else falls into place JFK/EWR may not have the slots available
I’ve been looking for availability on Elal from TLV to NYC the week after chanuka, and I wasn’t having any luck. Just this morning, Elal added another flight (the seat map looks like the flight is completely empty).
Can they do this as often as they want?
It happens occasionally when they have spare aircraft and slots.
Why are these websites only in Hebrew????
Dan’s conclusions are exactly right. Arkia is a disaster if an airline. Flights rarely depart on time, that is even if they are not cancelled. Arkia claims it does not have to respect EU legislation on flight disruption compensation. It has zero customer service even when the department is open, and it closes at 5pm! It is a joke to imagine that hi tech execs will fly with these jokers. Hi tech people are used to flying Business Class on US and / or European carriers which make even El Al, which is now much improved, look like a cheap imitation.
“North American carriers Air Canada, American, Delta, and United have remained on the sidelines.”
Just curious about your thought process when listing these airlines. Did you list them deliberately in alphabetical order so as to avoid promoting one over the other?
Alphabetical is my general preference.
Reminds me of the typical,
חתימת הרבנים ע”פ סדר הא”ב…
🙂
My opinion
No. Not even a chance.
Thanks to Dan, i got into miles and i booked a ticket to Rome with United points and El Al with Chase portal preferred less than 24 hours before the flight (and had 24 hours to cancel!) For a family engagement.
United has the American white glove service and kept offering their credit card and thanks g their customers
The difference in the ElAl flight was stark. They are efficient, they have grit, they nearly took off right after the last person (me) got on the plane.
They have the business down to a science.
No start up can compete with their expertise.
Why are airlines willing to fly to Lebanon?
Erm, which foreign carriers are flying to Lebanon?!?
MEA, business as usual
They are not a foreign carrier, they’re based in Beirut. 😀
All I can add is I had similar experience with arkia reservation system. Their website is only Hebrew and very difficult to navigate. When trying to book on other websites, it seems their algorithm plays with the system and doesn’t allow the booking. Each time I attempted to complete the booking it said change of time and kept on bouncing back-and-forth.
Finally getting a reservation on their website, they changed the flight time from 4 pm to 5 am. Doesn’t seem like they have what it takes to service the American public to Israel.
artificial scarcity definition?
I Thought that meant creating scarcity by lowering supply to manipulate markets.
When There is no actual ability to add supply = actual scarcity.
True that lowering the price will cause the scarcity , however , being that the cost will still be at or above the Normal price range for the this market it shouldn’t be referred to as artificial.
Please correct me if I’m wrong,
There is actual scarcity now, yes. You can find affordable tickets if you buy in advance, but at the last minute they’re pricey and hard to find.
If the price is lowered below the market rate, you will create artificial scarcity. Same as if we regulated the price of gas to below market rates, which would create what I would call artificial shortages.
First they got to get normal websites and figure out how to do customer service
Maybe this is the ideal time to set up a halachic airline exclusively owned and operated by Charedim. Charedi pilots and flight attendants serving every hashgacha imaginable with seating separated by gender. It’s enough of the bad pr from flying non-halachic airlines. DansDeals Airlines??
Bring back TowerAir! If anyone knows Morris Nachtomi this is the perfect time to get in touch
מחלל שבת and liberals that absolutely HATE you nevermind the horrible service and zero reliability
I don’t give this any chance of success. By the time they would get this going the US airlines will be back and would make this entire idea a big money loser for them
I really think one of the us based airlines needs to make some sort of agreement with an airline that is still operational whether that is blue bird, israir or arkia. This way you can book a connecting flight through Europe that isn’t a self transfer. The fear of self transfers is there is no insurance if I miss my flight. If there is some type of arrangement that can allow me to book tlv to FCO on blue bird, and FCO to EWR on United. United would just get more passengers on that flight, what do they have to lose?
Not going to happen. What I’d like to see happen is United flying EWR-ATH-TLV with the crew swapping out in ATH.
Sadly, it doesn’t seem likely to happen either.