El Al; Transfer of regular routes to Arkia, Israir doesn’t affect revenue
El Al admits that the transfer of some of its scheduled routes to Arkia Israeli Airlines and Israir will not affect its revenue. This declaration contradicts El Al’s argument in opposing the Ministry of Finance initiative to transfer some regular routes to private Israeli companies, and the decision of former Minister of Transport Ephraim Sneh to deprive El Al of routes to Copenhagen, Tashkent, Tbilisi, Lubliana, Riga, and Lisbon.
In its financial statements for the first nine months of 2002, El Al stated, “The Minister of Transport’s decision to grant the status of designated carrier to the two Israeli companies will not directly detract from the company’s revenue.”
In the section concerning the air traffic rights of competing Israeli airlines, El Al wrote, “Company management believes that the decision materially affects the status of the other Israeli companies, and this trend has consequences for the status of the companies and its development possibilities. Nevertheless, the decision will not directly detract from the company’s revenue.”
In August 2002, El Al chairman Michael Levi declared that transferring regular routes to Arkia and Israir would lead to “lay-offs, shutting down of operations, and serious consequences for the recovery program.”
Arkia took the Copenhagen, Tashkent, and Tbilisi flight destinations; Israir decided to operate scheduled flights on the Lubliana, Riga, and Lisbon routes, on which it will operate in cooperation with a local company.