El Al profit jumps 260% as rivals stay away, fueling criticism over war profiteering
National carrier generated a record $1 billion in revenue after most foreign airlines suspended Israel operations; some relief for severe seat shortage in sight from Arkia, Israir
Sharon Wrobel is a tech reporter for The Times of Israel.
Israel’s flagship carrier El Al reported another quarterly record profit in the July-to-September quarter, raking in $1 billion in revenues, as it benefited from a near-monopoly with most foreign airlines still not flying to and from Tel Aviv amid the war in Gaza and attacks from Iran and its Lebanese proxy Hezbollah.
El Al earned $187 million in the third quarter, up almost 260 percent from the $52 million a year earlier, which preceded the outbreak of war prompted by the Hamas terror group’s October 7, 2023, onslaught. During the summer season, revenue jumped over 43% to $1 billion from $696 million in the corresponding quarter last year. The airline said its planes were 94% full on average, up from 88% last year.
Major foreign airlines have repeatedly halted service to Israel since the outbreak of war in October 2023, ceding the market to El Al, some smaller Israeli carriers and a handful of other airlines, mostly from the Persian Gulf and Eastern Europe.
Israel has insisted that its airspace is safe and that it would shutter its skies should the need arise.
As a result, El Al maintains a monopoly status on many routes, which is leading to a fierce shortage of seats and exorbitant airfares. Customers seeking to book tickets for a vacation or business travel have been struggling to find seats even at sky-high prices. The airline’s record profits have led some to accuse it of price-gouging and war profiteering, which the carrier denies.
“El Al has been operating in emergency mode for more than a year, and our goal is to ensure that the skies remain open between Israel and the world,” said El Al CEO Dina Ben Tal Ganancia. “Throughout the months of the war and especially in the current quarter, we continue to experience increased demand for El Al flights, which is significantly higher in relation to the seat capacity that the company is able to offer.”
“We make every operational effort to increase the supply of seats as much as possible, in order to find solutions and serve the public traveling from and to Israel, but for the moment we don’t have any substantial capacity to add additional flights and therefore everything needs to done for foreign airlines to resume their operations to Israel. Otherwise passenger demand will not stabilize and the problem will only get worse,” she cautioned.
Shlomi Zafrany, El Al’s vice president for commercial and industry affairs, told The Times of Israel that airfares have increased 16% on average in the past year.
“The high demand and limited seat availability as foreign airlines are not coming back for now means that most of the flight seats fill up very quickly, which makes it very difficult to buy tickets to many destinations closer to the departure time,” Ben-Tal Ganancia explained. “We continue to conduct a strict price policy and actively work to cap ticket prices, by setting a ceiling on airfares for passengers for round-trip flights to all El Al destinations.”
El Al, which operates 150 flights a day, said its flight prices to North America range from a minimum of $799 to a maximum of $1,900. To Eastern Europe, including destinations such as Prague, Bucharest and Budapest, tickets sell between $158 and $637; and to other popular destinations in Europe such as London and Paris the range is between $353 and $880.
“Israelis and many business people tend to book last minute for the next week or two weeks ahead of time and then they find that there are no seats available, with long waiting lists,” said Ben Tal Ganancia. “In the current situation, customers need to book many months in advance, even one year in advance to be able to buy a ticket at the lower range of airfares.”
In recent months, US airlines completely stopped flying to Israel amid heightened fighting between Israel and Hezbollah in southern Lebanon, and as tensions rise in the Middle East. American Airlines extended the suspension of flights to Tel Aviv from until September 2025. US carrier Delta Airlines canceled routes to Israel until April next year, joining an array of foreign airlines that have recently extended their flight suspensions.
United Airlines has suspended its flights to Tel Aviv for the foreseeable future due to security concerns
That has left El Al as the only airline flying from Tel Aviv on direct routes to North America. The lack of competition has led to a severe shortage of seat availability while driving up airfares.
“In normal times the current high demand levels for travel to New York would have pushed up airfares in economy not to a maximum $1,700 but to as much as $3,000, and this is what we are trying to avoid with the cap,” said Zafrany.
Israel’s smaller airlines Israir and Arkia are now gearing up to operate flights to North America. The launch of flights to the US hinges on their need to fulfill certain conditions by the Civil Aviation Authority and obtain regulatory approval from US aviation authorities. To operate a long-haul service to the US, they would also need to find an operator or a partner to wet-lease wide-body aircraft and flight crews, which they currently don’t have.
“We welcome the efforts, but the Israeli airlines are facing a major challenge to find crews that are willing to stay overnight in Israel, which is perceived as a war zone,” said Ben Tal Ganancia. “Even if they succeed, which will be good, it will not lead to a dramatic change.”
El Al’s Zafrany noted that the suspension of flights by US airlines — Delta, American Airlines, and United Airlines — to and from Tel Aviv means that there is a seat shortage of 50% on direct routes to the US, or about 40 to 50 flights a week.
“Arkia and Israir will hopefully be able to operate five to six weekly flights to the US, which will help reduce the severe seat shortage but it will not solve the problem,” said Zafrany.
