El-Al loses monopoly on direct destination flights

Mofaz's "Open Skies" reform launched; government to increase participation in airline security expenses.

By JPOST.COM STAFF
January 27, 2008 16:54
el al ben gurion 88 298

El Al 224.88. (photo credit: Ariel Jerozolimski [file])

Israel's flagship carrier, El-Al, will no longer enjoy a monopoly on the country's air travel, according to a far reaching reform launched Sunday by Transportation Minister Shaul Mofaz (Kadima). The first stage of the amendment will be El-Al's withdrawal from its long-standing monopoly on popular destinations. Simultaneously, there will be a substantial increase in government subsidies of security arrangements for other Israeli airlines. The move is estimated to cost approximately $80 million a year. "After months and months of deliberations, we have finally reached an agreement with El Al canceling its exclusivity in the Israeli flight market", said Mofaz. "It's a true revolution for the local consumer; we expect ticket prices to drop rapidly". The Transportation Ministry's chief executive, Gideon Siterman, added that the European Union supported the initiative and was in negotiations with Israel over renewing flight policies and agreements. El Al said that the company had been acting in a competitive market ever since being privatized. "We expect the government to assist Israeli airlines to increase the number of direct-destination flights and to facilitate their communication with foreign authorities, to ensure that competition is run on a level ground", the company's statement said.


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