El Al’s profits soar as foreign carriers’ cancellations give it market dominance
National airline reports $147 million earnings in second quarter, up 80% on previously record-breaking Q1; firm has faced accusations of taking advantage of situation to hike prices
El Al reported record profits for the second quarter of 2024 on Thursday, as much of its international competition has seen disrupted operations in Israel amid the war in Gaza and fears of attacks from Iran and Hezbollah.
In tandem, the national airline inked a deal with Boeing to replace its aging short-haul fleet.
El Al said its profits between April and July were $147.4 million. The earnings were more than 80% higher than the $80.5 million El Al earned in from January to March — at the time its best quarter to date.
The company has been criticized for seemingly taking advantage of the situation to raise ticket costs, sometimes to exorbitant rates.
“Since the war broke out over 10 months ago, we are acting in a complicated and uncertain market, and are required to conduct our business carefully and efficiently,” said El Al CEO Dina Ben Tal Ganancia in a statement.
“The past few days have demonstrated outstandingly just how fragile the notion of ‘open skies’ is in the Israeli context,” she added.
Air travel has been repeatedly shaken by the war in Gaza and spiking regional tensions. When the fighting began in October with the Hamas attack on Israel, most foreign airlines halted their flights. Service gradually resumed in the following months but was then disrupted again when Iran launched a direct major drone and missile attack on the country in April. Some carriers then resumed service, but jitters again caused many to shutter their routes in recent weeks for fear of yet another Iranian attack.
The cancellations came as Israel braces for responses from Iran and its Lebanese proxy Hezbollah to the late July killings of Hezbollah military commander Fuad Shukr in Beirut and Hamas chief Ismail Haniyeh in Tehran.
Israel has insisted that its airspace is safe and that it will shutter it if and when the need arises. Israeli airlines have continued operations as usual.
On some routes, El Al has become the only option for Israeli travelers. Even when others exist, it is currently seen by many as the most stable, dependable option.
Kan news reporter Shaul Amsterdamski wrote on X on Thursday that El Al had rebuffed his offer to interview Ben Tal Ganancia about the record-breaking profits on his evening radio program. According to Amsterdamski, the company said it was not giving interviews.
“I asked why. They responded that it’s what was decided. They know how to charge crazy prizes. They know how to speak off-record. [But] speaking on the record to the public — that’s a no,” he wrote.
Meanwhile, El Al and Boeing confirmed Monday that the airline would buy up to 31 737 MAX aircraft from the aviation company.
According to the deal, El Al will purchase 20 units of the new model for $1.5 billion, with the option to add 11 more for an extra $1 billion.
Flights on the new aircraft are expected to begin in 2028 and replace the airline’s current fleet of 737-800 and 737-900 planes.
