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Govt Picks-Up Airline Costs. Fair Competition? Or...?


Government to pay 80% of Israel airline security costs

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Jan 28, 2008

TEL AVIV - Israel's government has agreed to pay 80 percent of the security costs of the country's airlines, up from 50 percent until now, El Al Israel Airlines ELA.TA said on Sunday.

The government also decided that Israel's transportation minister will rule whether to open up certain routes to additional Israeli airlines, ending El Al's exclusivity on those routes for scheduled flights.

"El Al welcomes the government's decision by which it expands its policy of opening the skies to competition while increasing its financing of security costs of Israeli airlines to 80 percent," it said in a statement.

The government's decision will help Israeli airlines to compete as the number of seats offered by foreign airlines to Israel expands, El Al said.

Since April 2006 the number of seats offered by foreign airlines to Israel has increased by 45 percent, it added.

Israel's leading airline has long contended that due to its heavy security burden it faced difficulties in competing with foreign airlines.

Israel also has two smaller carriers, Israir and Arkia Israeli Airlines. Israir already flies regularly scheduled flights to New York in competition with El Al.

reuters.com

Government to pay 80% of Israel airline security costs



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