El Al- A Monopoly or Savior?
By Jonathan Katav
September 15, 2024
Ever since the tragedy that happened on October 7th, 2023, Israel’s main air carrier, EL AL, has been in the headlines multiple times, both good and bad. What started as praise for flying military reservists and stranded passengers on extra seats in the cockpit, flight attendants’ seats and even on the floor, has turned into an outrage against the company.
For the first few months after the war broke out, the majority of international airlines pulled out of the Israeli market and halted their services. This caused EL AL to become the main gateway to the country. Their market share at Ben Gurion Airport has climbed to 80%, compared to 21.5% in the same period of
2022.
Some speculate EL AL has used this opportunity to gain extra profit by raising their airfares, although CEO Dina Ben Tal Ganancia, denies these claims.
Poor feedback started to roll towards the company, which started to get called “a monopoly”, especially on their routes to the United States. This was due to the U.S. airlines - United, Delta and American, canceling all of their flights to Israel. Passengers have claimed EL AL was charging upwards of $10,000 for roundtrip Business Class tickets and $2,000 in Economy Class to the Big Apple, compared to $2,500 and $850 from the previous year, which is a significant raise.
The backlash grew even bigger, after EL AL released its income reports totalling up to $2.5 billion in 2023, $738 million in Q1 and $839 million in Q2 of 2024.
Many Israelis started to call out the company, demanding lower prices and encouraging foreign airlines to return to the country, stating that “If EL AL can fly here during the war, why can’t all of the other airlines?”.
In an attempt to face the accusations of exploiting war to increase profits, EL AL has introduced fixed fare prices, which range from $199-349 to four destinations. These destinations include Athens, Vienna, Larnaca and Dubai, all of which serve as hubs for flights to and from Israel.
According to Walla News, the airline has made this move in exchange for not having a windfall tax imposed on its supposed excess revenues from the war-related last year.
Yes, the ticket prices are high, even now on September, 11 months after the war broke out. However, we must also commend the airline. They have continued operating flights to many destinations across the globe, unlike foreign carriers.
Resuming operations in these difficult times includes taking many risks, which results in pouring more funds into operations. There is a danger that due to the military escalation in the area, the company’s planes may be harmed, yet the carrier still continues to fly.
That said, EL AL has simply no other choice. It cannot allow itself to stop flying as their whole market is flights to and from Israel. They serve as the primary access point into the country, and shutting it down would result in a significant chokepoint.
Therefore, it can be understandable that the airfare prices are high compared to the few foreign airlines that operate in the Israeli market, albeit at a certain limit.
Sources: The Times of Israel, Globes, Walla News, EL AL Website Image Source: https://www.israelairlinemuseum.org/el-al-brief-history-2/