El Al Chairman Eli Defes said in an interview on Sunday with Kan News that El Al could collapse within weeks if the Israeli government doesn’t provide urgent financial assistance to its national airline.
An Israel Hayom report said that El Al is six weeks away from collapse
And it’s not just El Al – Israel’s two smaller airlines, Arkia and Israir, which operate mainly domestic flights and flights to and from Europe, are also in dire financial straits. All three airlines have requested emergency loans from the government to enable them to survive through the coronavirus crisis and resume operations when it ends.
El Al has asked for $400 million in loans and $200 million in guarantees and has also presented a recovery plan to the Finance Ministry outlining how the company will streamline its operations to aid its recovery when the coronavirus crisis ends. However, the Finance Ministry has not yet responded to El Al’s requests.
“[Governments] all over the world are giving billions upon billions to their airlines,” Defes said. “We submitted a recovery plan two weeks ago and the Finance Ministry hasn’t responded to it. If they don’t come up with a solution soon, the company could cease to exist within a few weeks.”
“Our situation gets worse each day that passes,” wrote El Al CEO Gonen Usishkin in a letter to company employees. “We’re approaching the point at which the state must decide whether it wants a national airline, or whether it believes that aviation security is not an important and substantial element in national security.”
Arkia and Israir Airlines have asked the government for $25 million loans each and they are also seeking government approval for a possible merger of the two airlines or even a merger of all three airlines.
Arkia chairman Avi Homero told Globes on Sunday: “At such a time, you have to think outside the box. This is something that could save the airlines, and I don’t rule out the option that in the end, all three airlines could merge into one company. I won’t say that this is on the table, also because of the Israel Competition Authority, but we’re talking about it between us.”
Israel’s Airports Authority (IAA) announced on Monday that only three international airlines, Aeroflot, United and Ethiopian Airlines, are still operating at Ben-Gurion Airport, with the exception of the rescue flights being carried out by Israeli airlines to repatriate Israeli citizens stranded abroad.
Although El Al halted all commercial flights as of Thursday, it is operating two additional flights to New Zealand and Australia to expatriate Israeli citizens stranded there, Israel’s Foreign Ministry announced on Monday.
The ministry stated that “these countries have the largest concentration of Israeli citizens who wish to return home.”
Also, two flights carrying hundreds of Israelis from Thailand and India are scheduled to land in Israel on Monday.
There are still 2,151 Israeli citizens stranded abroad who wish to return home, the Foreign Ministry stated.
In other aviation news, EasyJet, a low-cost British airline which operates many flights to and from Israel in normal circumstances, announced on Monday it is grounding its entire fleet of 344 airplanes in the wake of the coronavirus crisis.
(YWN Israel Desk – Jerusalem)
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One Response
Just wondering- if the government, aka the people, get to share the rough times and bail out the company, do they also get to share in the good times and share in the profits too ?