Fighting competition from low-cost airlines, El Al introduces cheap flights

The catch is that all the normally complimentary extras, such as meals, drinks and baggage, will come at an additional cost for each item.

By ARIEL ZIRULNICK
El Al great 88 248 (photo credit: El Al via Bloomberg)
El Al great 88 248
(photo credit: El Al via Bloomberg)
Are there travelers cost-conscious enough to give up meals, drinks, free baggage and other flight "frills" in exchange for significantly discounted plane tickets? El Al Airlines is banking on the answer being "yes" as it launches a new business endeavor - tickets on its regular flights for 30 to 40 percent less than a normal ticket. The catch is that all the normally complimentary extras, such as meals, drinks and baggage, will come at an additional cost for each item. "The idea behind this product is to give people choice," said El Al's marketing director Amit Livni. "Not all of them can afford the fares of the premium product that we give our passengers." The new product is aimed at people who can't afford or don't want all the services of El Al's comprehensive product, but value the extra security and atmosphere the airline provides, Livni said. It will place customers with no-frill tickets on the same plane as customers who paid full price. The first of these pilot flights began in late July on Sunday, Monday and Wednesday to Rome for $199. For the time being, the no-frill option will only be available for European flights. Sources in the industry attribute El Al's move to competition from low-cost airlines. AirBerlin recently began flying from Germany to Israel, and EasyJet is to begin service from the UK to Israel in November. The sources say El Al is concerned that it may lose business to the cheaper companies. Livni, however, denied that they were competitors in the same market, saying that El Al offered a different product than the other two airlines. "They don't offer choices. They don't have premium products," Livni said. He compared El Al to a premium hotel offering its normal luxury rooms as well as rooms with just regular beds, and EasyJet and AirBerlin to a hostel with only one choice for its customers. Low-cost airlines are relatively new, but a European carrier executive said it was unlikely that they were a passing phenomenon and they were likely to outlast the current recession. "There are enough people that have no problem saving 30 dollars and flying like sardines," he said. "Someone will make money out of it. The Israeli public has always looked for the best value."