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Israeli Transport Minister Recommends Open-Skies  
User currently offlineLaxintl From United States of America, joined May 2000, 24880 posts, RR: 46
Posted (7 years 3 months 1 week 3 days 22 hours ago) and read 2284 times:

Transportation Ministry recommends unlimited airline competition

Transportation Ministry director general Gideon Siterman recommended unlimited airline competition Thursday, which would require revoking the national carrier's monopoly on most routes.

"There should be unlimited competition between Israeli airlines to any destination around the world," said Siterman, who headed a committee examining the issue. He is slated to present the panel's findings to the cabinet shortly.

Also, it was recommended to open negotiations immediately with the European Union in order to reach an Open Skies agreement to be implemented gradually over three years. It is expected that such a deal would cost Israeli airlines $50-75 million a year in lost revenues, but at the same time travelers would save $70-105 million annually. Finally, the committee recommended a number of steps to increase tourism to Israel, which would increase revenues from tourism by $100-300 million a year.



Full Story;
http://www.haaretz.com/hasen/spages/850775.html


From the desert to the sea, to all of Southern California
11 replies: All unread, jump to last
 
User currently offlineKaitak From Ireland, joined Aug 1999, 12411 posts, RR: 37
Reply 1, posted (7 years 3 months 1 week 3 days 22 hours ago) and read 2251 times:

A welcome development no doubt, but isn't EL AL at a competitive disadvantage, since it will only be allowed to fly six days a week, while every other carrier has unrestricted access? (Are Israir and Arkia also restricted the same way as EL AL?)

User currently offlineIAD380 From United States of America, joined May 2006, 804 posts, RR: 0
Reply 2, posted (7 years 3 months 1 week 3 days 22 hours ago) and read 2229 times:

Quoting Kaitak (Reply 1):
isn't EL AL at a competitive disadvantage, since it will only be allowed to fly six days a week,

No, El Al is now a privately-owned company that can make its own decision about whether to fly seven days a week. The board of directors of LY decided not to fly on the Sabbath and high holy days out of deference to its Orthodox customers. Recently, these customers threatened a boycott when LY flew on the Sabbath. When LY was a state-owned company, the law prohibited it from flying on Sabbath and holy days.

I think that Open Skies may place Israeli carriers at a competitive disadvantage because they have higher security costs than other airlines. Also, I think it is an open question as to whether European LCCs will start flying to Israel.


User currently offlineTodaReisinger From Switzerland, joined Mar 2001, 2804 posts, RR: 1
Reply 3, posted (7 years 3 months 1 week 3 days 16 hours ago) and read 2090 times:

Quoting IAD380 (Reply 2):
When LY was a state-owned company, the law prohibited it from flying on Sabbath and holy days.

Yes, between 1982 and until privatization, and the airline claimed that this ban was the main cause for its financial problems...It even asked the Sate to "reimburse" huge sums of money; but now, it is continuing the Shabbat no-fly policy by its own...

*

Competition is something positive, but low ticket prices are sometimes an open door to minimal or poor maintenance. I hope all necessary measures will be taken to ensure that the security and safety levels remain high enough..... But clearly, if LCCs were to fly between Europe and TLV, that would lead to a life threatening situation for LY.

In the 1970s, when the Israeli Tourism ministry decided to allow foreign charter flights to Israel, LY fought against this step, with no success; then, LY created its own "charter airline" in 1977 (El Al Charter Services, renamed Sun d'Or 4 years later). But Sun d'Or is not a LCC and it is not, as of today, able to compete effectively with LCCs like easyJet, Air Berlin or Ryanair. And those LCCs have developed impressive networks inside Europe, they would be able to offer connecting flights to any European destination at low price, something any Israeli charter or LCC could not be able to offer.



I bitterly miss the livery that should never have been changed (repetition...)
User currently offlineIkramerica From United States of America, joined May 2005, 21476 posts, RR: 60
Reply 4, posted (7 years 3 months 1 week 3 days 16 hours ago) and read 2087 times:

Quoting TodaReisinger (Reply 3):
But clearly, if LCCs were to fly between Europe and TLV, that would lead to a life threatening situation for LY.

I think it would destroy LY entirely.



Of all the things to worry about... the Wookie has no pants.
User currently offlineLemurs From United States of America, joined Mar 2005, 1439 posts, RR: 4
Reply 5, posted (7 years 3 months 1 week 3 days 15 hours ago) and read 2062 times:

Quoting TodaReisinger (Reply 3):
Yes, between 1982 and until privatization, and the airline claimed that this ban was the main cause for its financial problems...It even asked the Sate to "reimburse" huge sums of money; but now, it is continuing the Shabbat no-fly policy by its own...

As it essentially has to, in order to keep a sizeable fraction of its customer base. People complain about this like they're being held hostage by the religious right, but the fact is, the only tool they have at thier disposal is the one any profitable company cares about...money.

No one can make people fly El Al, and if El Al flies on the Sabbath, they'll lose ~20% of their pax to other carriers. So you sit down and do the math...fly 6 out of 7 days, with the one day off being of minimal operating costs? Or lose 20% of your customers on the other 6 days while seeing how many you can pick up on that one extra day? It's pretty obvious how the math fell out after the whole fiasco in December of last year, with EY backing down quickly.



There are 10 kinds of people in the world; those who understand binary, and those that don't.
User currently offlineTodaReisinger From Switzerland, joined Mar 2001, 2804 posts, RR: 1
Reply 6, posted (7 years 3 months 1 week 3 days 15 hours ago) and read 2054 times:

Lemurs,
I'm not against LY not flying on Shabbat and holy days, and I fully understand why they are willingly continuing this policy wich was, before privatization, a legal constraint; but, it is interesting to remember that for years, LY had been claiming that this Shabbat ban was a catastrophe for the airline and that the State should pay for it. For sure, they knew the situation as well as today...but that was taken as a false excuse to justify poor results and to claim for "compensation". That's the point I tried to underscore...



I bitterly miss the livery that should never have been changed (repetition...)
User currently offlineIAD380 From United States of America, joined May 2006, 804 posts, RR: 0
Reply 7, posted (7 years 3 months 1 week 3 days 13 hours ago) and read 2015 times:

Quoting Ikramerica (Reply 4):
I think it would destroy LY entirely.

El Al, and perhaps Arkia and Israir, would have difficulty competing if Israel and the EU signed an Open Skies Agreement. Only time will tell if El Al and the others could adapt and survive. However, an Open Skies Agreement is not a foregone conclusion. The management and unions at LY will surely fight it. Also, several European carriers, such as LH, BA, and AZ, may quietly lobby against LCCs on flights between their hubs and TLV. After all, TLV seems to be one of the most profitable routes for several European airlines.


User currently offlineLemurs From United States of America, joined Mar 2005, 1439 posts, RR: 4
Reply 8, posted (7 years 3 months 1 week 3 days 12 hours ago) and read 1985 times:

Quoting TodaReisinger (Reply 6):
I'm not against LY not flying on Shabbat and holy days, and I fully understand why they are willingly continuing this policy wich was, before privatization, a legal constraint; but, it is interesting to remember that for years, LY had been claiming that this Shabbat ban was a catastrophe for the airline and that the State should pay for it. For sure, they knew the situation as well as today...but that was taken as a false excuse to justify poor results and to claim for "compensation". That's the point I tried to underscore...

Ahh yes, well that would really be the problem...gross mismanagement and terrible labor issues mean they have a hard time competing in a truly open environment. If they could get that part squared away, they'd be in very good shape, because that same 20% that would boycott are religiously faithful (excuse the pun) to fly LY, regardless of fares. Their problem is getting past their union and costs issues though...and that is one tough nut to crack.



There are 10 kinds of people in the world; those who understand binary, and those that don't.
User currently offlineAvi From Israel, joined Sep 2001, 939 posts, RR: 6
Reply 9, posted (7 years 3 months 1 week 3 days 5 hours ago) and read 1910 times:

Quoting IAD380 (Reply 2):
I think that Open Skies may place Israeli carriers at a competitive disadvantage because they have higher security costs than other airlines.

According to the plan the state will cover 100% of the security cost for all 3 airlines.



Long live the B747
User currently offlineIAD380 From United States of America, joined May 2006, 804 posts, RR: 0
Reply 10, posted (7 years 3 months 1 week 2 days 21 hours ago) and read 1792 times:

Quoting Avi (Reply 9):
According to the plan the state will cover 100% of the security cost for all 3 airlines.

Wouldn't covering the security costs for all 3 carriers be a state subsidy? Subsidies seems incompatible with the underlying concepts of free markets and Open Skies. What is the likelihood that the EU would agree to Israel paying the security costs of its own airlines in an Open Skies Agreement? After all, EU carriers probably face similar security costs on these routes. I would suspect that EU rules prevent national governments from paying these types of subsidies to their airlines.


User currently offlinePe@rson From United Kingdom, joined Jan 2001, 19196 posts, RR: 52
Reply 11, posted (7 years 3 months 1 week 1 day 22 hours ago) and read 1721 times:

There have been a number of rumours of Ryanair flying to Tel Aviv; indeed, the last news article I read stated that Ryanair might start flying to Israel this year. Productivity-wise, it need not be a problem, depending upon where you fly to and from. For example, HHN-TLV-HHN could be done in under 8 hours 45 minutes including a 25- or 30-minute turn, thereby still enabling 2 further rotations in one day. LON-TLV-LON could be done under 10 hours 15 minutes, which could also enable at least 2 more rotations depending on when the flight departs LON. CIA-TLV-CIA could be done in 7 hours 30 minutes, while BGY-TLV-BGY would take under 8 hours 30 minutes. All of those flights could be done using the same crew. How would the additional security affect such an operation in terms of cost, time to implement and overall complexity? Would a 25- or 30-minute turnaround still be achievable?


"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
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