Israeli flag carrier El Al has contracted US bank Chase Manhattan to examine the funding of its planned widebody purchase and to assess market demand in Israel and the Middle East over the next decade.
Chase has been brought in because of concerns expressed by some El Al board members over the carrier's ability to fund the acquisition, given its own projections of falling revenue in the face of competition from new market entrants. The bank will also assess conflicting projections of demand from Boeing and Airbus which the two manufacturers are using to push for orders for their competing types.
Sources say the order itself is not in question, although a requirement for around 10 aircraft may be reduced to an initial one for just four or five.
The airline faces a choice between a mix of Boeing 777 and 767-300/400ERs, or Airbus A330s and A340s. Chase will also assist El Al in preparing applications to US Eximbank, in the event of a Boeing order, or to European export credit agencies, should it plump for Airbus.
The European manufacturer's senior vice president commercial, John Leahy, has meanwhile met with new Israeli finance minister, Avraham Sochat, with the aim of combating a perceived pro-Boeing bias at El Al linked to the special relationship between Jerusalem and Washington. Leahy says he hopes the airline will be allowed to select the best aircraft without any "political pressure".
Source: Flight International
