El Al, Jewish Agency seek to end spat

El Al, Jewish Agency see

December 17, 2009 23:38
2 minute read.

Senior officials at the Jewish Agency and Israel's largest airline, El Al, are looking to renew cooperation after an acrimonious financial dispute has seen the severing of all ties between the organizations. El Al believes the Jewish Agency pays too little for flights, and has begun to demand in recent weeks that the agency agree to higher prices for the thousands of flights it generates each year. The price dispute quickly turned into a stalemate, with El Al demanding up-front payment for each oleh ticket and the agency vowing to strike deals with other airlines, including Israir, Arkia and non-Israeli carriers, to bring olim and carry agency officials and emissaries abroad. In the past two weeks, the agency has signed deals with both Israir and Arkia to carry Israel-program participants from Diaspora countries and agency emissaries to their destinations. However, according to senior officials in both organizations, the two are coming to the realization that they need each other. "Neither side can live without the other," said an official. "The agency is a strategic partner for an airline, and El Al can give it things others can't." The agency is a huge customer, spending an average of NIS 20m. annually on airline tickets, mostly for olim whose one-way tickets to Israel are paid for by the agency. While individual agreements with smaller airlines can fill the gap on certain well-traveled routes, El Al is by far the largest Israeli airline and can usually offer large, globe-spanning organizations like the Jewish Agency more flexibility and a greater capacity to organize last-minute emergency flights for Jewish communities in trouble. On Monday, after a meeting between agency chairman Natan Sharansky and El Al CEO Haim Romano, the two companies opened negotiations on reestablishing a working agreement between them. Even if cooperation resumes, however, El Al may turn out to be the loser. To fill the weeks-long gap during the dispute, the agency has already signed agreements with Israir and Arkia totaling over NIS 6m. in flights annually. Arkia is now the agency's airline for flights to Munich, Kiev, Tblisi and well-trafficked Paris, totaling some NIS 4.1m. annually. Israir has taken over the routes to Rome, Basel, Nice and lucrative Moscow, for a total of some NIS 2m. annually. Yet negotiators in both organizations believe the dispute is near its end. "I believe joint work will resume in the coming weeks," a senior agency official told the Post. "Both sides have an interest in cooperation. I believe that in a couple weeks or a month, we'll resolve this," a senior El Al official agreed.

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