With the Open Skies agreement already boosting low-cost competition, El Al on Tuesday announced the launch of its own low-cost carrier Up, which will begin flying to five European destinations as of March 30.
The carrier will offer up to 11 weekly flights to and from Tel Aviv and Berlin, Prague, Kiev and Budapest, and up to 6 weekly Larnaca flights. The former three will be priced starting at $99 each way, and the latter two starting at $69.
"We are joining the trend in the international airline industry of and the major world airlines, while being attuned to a variety of customer preferences" El Al CEO Eliezer Shakedi said. "I am convinced that this process will improve our competitiveness, widen our customer base and respond well to passenger needs, and all at reasonable prices."
Despite the low costs, there are extra fees for extra services. The airline will only allow passengers to select seats ahead of time with a $10 add on. That rises to $50 for a prefered seat and $80 for a "plus class" seat. Sending luggage will cost $20 if it's paid ahead of time, and $40 if it's not. Premium ticket holders and frequent fliers can get those perks at lower or no costs.
El Al seems to have taken an "if you can't beat 'em, join 'em" aproach in its decision to join the low-cost market.
Just in April, it led a strike protesting the government's approval of the Open Skies policy, which increases competition for landing slots in accordance with EU standards. The agreement was expected to boost low-cost carriers against the traditional airlines. The strike ended when the government agreed to cover 97.5 percent costs of El Al's security costs, which it was forced to extend to other airlines.
Just last week, EasyJet announced it's sixth route to and from Tel Aviv with a new Berlin flight.
The Tourism Ministry estimated that the Open Skies agreement would result in an increase of 250,000 tourists from Europe in 2014, the first year of its operation, and create nearly 10,000 new jobs.