Agreement with the EU is a fact – how will El Al adjust?

The result was expected but the process was faster than I forecast.

 

In spite of opposition from the Israeli airlines, especially El Al, at the end of last week the Israeli government and the EU finalised negotiations on a comprehensive aviation agreement.

 

This will gradually open up and integrate the respective markets.

 

As a result of the agreement, all EU airlines will be able to operate direct flights to Israel from anywhere in the EU, and Israeli carriers will be able to operate flights to airports throughout the EU.

 

The EU-Israel air transport market will be opened gradually so that by the start of the summer season in 2017 the market will be fully open, with no restrictions on the number of weekly flights between Israel and the EU.

 

Based on the experience of similar agreements signed with other countries neighbouring the EU, the gradual opening of the market is expected to encourage a larger number of direct flights from Israel to more destinations in Europe at lower prices than today, while also reducing flight prices to Israel for European travellers.

 

In parallel to gradually opening up the respective markets, the agreement also aims to integrate Israel into a wider Common Aviation Area with the EU.

 

Israel will implement regulatory requirements and standards equivalent to EU aviation rules in areas such as aviation safety, the environment, consumer protection, including passenger rights, air traffic management, economic regulation, competition issues and social aspects.

 

The agreement will replace bilateral air services agreements between EU member states and Israel.

 

This happened last week. What happens now depends on the wisdom of the El Al management, and the comprehension of the real world by the Israeli anti-trust commissioner. So far, these two elements have been missing.

 

Without joining one of the big aviation alliances, El Al will soon be in a very bad position. After losing $49.4 million in 2011, the present and future look like big question marks.

 

All the Israeli aviation experts agree that El Al should go back to operating seven days a week, which will bring it nearer to membership in one of the alliances.

 

If El Al flies at the weekend, Ben-Gurion airport can become a convenient hub for flights to the east.

 

The Israeli airline has flights to many destinations in Asia. In spite of that, it can now look enviously across the border with Jordan, where Royal Jordanian is taking some of the potential traffic because it operates every day of the week.

 

Stupidity and a lack of willingness to try and change a poor decision taken when El Al was still state owned put the airline in a bad spot.

 

One thing should be secured before the agreement is officially signed – the capability of El Al, Arkia and Israir to fly to all the major European destinations without facing an answer of “no slot”.

 

This is the responsibility of the government, and in Israel sometimes the politicians tend to do a half job.

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