Israir and Arkia in talks to launch Israel-US flights

Since the start of the war Israel has been hit by the biggest aviation crisis in its history with less than 20 airlines currently operating flights to and from Ben Gurion airport. Since the assassination of Hezbollah secretary general Hassan Nasrallah in September, most European carriers have stopped flying to Israel following a recommendation by the EU Aviation Safety Agency (EASA) not to fly to Israel but the worst hit routes remain between Israel and the US, where El Al has a monopoly and fares are high.

American Airlines, Delta and United have all suspended flights until well into 2025 leaving El Al as the sole carrier between Israel and North America. In recent week there have been initiatives to break El Al’s monopoly.

Tech leaders through the DemocraTech protest movement announced it is holding talks to operate an airline between Israel and the US between January and March, with the aim of opening it up to the general public as well. Civil Aviation Authority chairman Shmuel Zakay has also announced talks with Israeli airlines Arkia and Israir to lease planes and operate flights between Israel and North America. This would significantly increase competition on the routes and lower fares.

“The shortage in the supply of seats on flights to the US is the most severe of any destination,” Zakay told “Globes,” prior to a further round of talks with Arkia and Israir. “At a time when tourists aren’t coming to Israel, the need for flights to America still exists. The second largest Jewish community in the world is there as well as the tech industry and other industries with widespread business connections there, and they need access to these destinations.”

According to Zakay, the Israeli airlines have expressed readiness to move forward on the matter but make this contingent on cooperation in amending the Aviation Services Law (Tibi Law), which foreign airlines are also insisting on.

According to the amendment, the airlines would receive a temporary exemption from the need to compensate passengers whose flights are canceled due to the security situation, while the obligation to provide alternative flights for passengers whose flights have been canceled would be restricted. Airlines would receive assistance in financing insurance for operating flights to Israel, including in leased aircraft.

Challenges facing Israir and Arkia in operating flights to Israel

There are several challenges facing Israir and Arkia if they want to operate flights from Israel to North America. They would need to find suitable wide-bodied aircraft through wet leasing – leasing aircraft and their crews – which meet US regulatory aviation standards. Because there are long-haul flights the foreign crews would need to sleep over in Israel and many crews are scared to do so. The Israeli authorities usually take between six months to a year to grant new licenses for such endeavors but the authorities have promised to fast track applications. Then as mentioned there is the demand to amend the law to protect the airlines from lawsuits following cancelations and disruptions.

According to industry sources, Israir is more likely to come through with flights to the US because it has operated flights in the past on leased aircraft to the US.

Zakay acknowledges the need for the airlines to reduce economic uncertainty through amending the law. He said, “We are talking about long-haul flights and if there are cancelations the risks for the company are very big. The compensation clause is very problematic for the companies, especially those that do not have a large fleet of aircraft.”

But he explains that other factors are involved in whether the airlines succeed in operating flights to the US including leasing appropriate aircraft.

He said, “In order to operate flights to the US wide-bodied aircraft are required, which Israir and Arkia do not have. They will need to lease aircraft using the wet lease method and the idea is that they will fly with an Israeli code.”

Zakay stresses that every effort would be made to shorten the procedures in Israel and the US by which the airlines receive a license to operate the flights. Also in order for the move to succeed the airlines would have to set up ground handling services in the US and arrange for crews to stay over in the US as well as Israel.

Zakay added, “For an airline there are financial risks, it’s operationally complex and to reduce the risks you need to bring in a large amount of planes.” Also, leasing the planes will not solve the problem of the foreign crews, who are often afraid and even refuse to fly to Israel.

From the approval in principle sent from the aviation authorities in the US, it appears that they approve use of aircraft that belong to countries that the US government considers to have a high level of security, such as the EU, Canada or Singapore.

There is feasibility

According to Zakay, timing favors the move. In the winter season, there is more potential to lease planes, due to reduced activity by airlines worldwide.

In 10 days, Zakay will meet with the director of the US Federal Aviation Authority (FAA) to confirm the process of obtaining approvals. At the same time, the airlines will move forward on leasing planes. “The Israeli airlines are in very advanced negotiations for the lease of aircraft with foreign airlines,” he said.

Industry sources believe that in order for additional flights to provide a satisfactory response for passengers, at least 18 weekly flights must be added to various destinations in the US, which would require at least four planes to fly to those different destinations.

The move could work, aviation industry sources say, but clarify that if it happens, it is important that the flights are not only to New York, because the lack of codeshare flights with other companies, may make it difficult to compete with airlines like Delta that provide convenient connections in the US.

Published by Globes, Israel business news – en.globes.co.il – on November 14, 2024.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2024.