ARIE EGOZI / TEL AVIV
Conflict with the Palestinians is having a drastic effect on airline traffic
Israel's airlines are bracing themselves for the worst winter in their history as a dramatic decline in traffic forces them to lay off workers and consider capacity cuts. With tensions rising in the Palestinian/Israeli conflict, the unprecedented fall in business is expected to lead to further measures by the airlines to stem losses.
The Israeli airport authority (IAA) has reported a 48% slump in tourist traffic in the January-May period compared with last year. Traffic this summer has partially recovered as a result of better than usual figures for Israelis going on holiday abroad. But the end of the Jewish holiday season in mid-October is expected to reduce passenger numbers to a fraction of the normal level. Total traffic during the period fell to 2.91 million passengers from 3.54 million during the five-month period in 2000.
Arkia, Israel's largest private airline, with a mixed fleet of Boeing 737s, 757s and turboprops, has already laid off 200 employees, and, according to president Israel Borovitch, a further 150 will now have to go, including 34 pilots. "We face a serious crisis, and need to adapt our workforce to the level of operation," he says.
Israir, the country's second largest private airline, also plans to lay off 40 of its employees - around 10% of the workforce.
State-owned El Al has already initiated an early retirement plan, with the aim of cutting employee numbers by 600. The crisis and the forecasts of worse to come will force the airlines to initiate other cost-cutting steps. El Al is already considering phasing out its three- strong 747-200 fleet, with a parallel reduction in crews.
The crisis is expected to affect the timing of the already delayed efforts to privatise El Al, although the government recently announced its intention to restart the process. Airline sources doubt that privatisation can go ahead in the face of anticipated losses of over $100 million this year.
Cargo traffic is also down as a result of the economic crisis and El Al is attempting to utilise its cargo capacity in new markets. The airline has added Sri Lanka as a stop off on its Hong Kong-Tel Aviv freighter service.
Generally, however, the trend is for the cancellation of services where passengers are concerned. El Al last week dropped flights to Copenhagen, and Air France and Continental have also announced frequency cuts from Tel Aviv.
The fall in tourist traffic is also having dire effects at Elat, a winter sun destination. Zeev Sarig, airport manager at the resort, is forecasting that foreign traffic in the coming October-May season will slump 40%. A number of charter operators, particularly Scandinavian, have already cancelled flights.
Ben-Gurion international airport in Tel Aviv is to change security methods, doing away with the unpopular "profile" screening system and replacing it with a highly sophisticated automated scheme.The profile system, based on a series of questions, caused angry passenger reaction. The IAA began pilot trials of a new system on 5 September. The system is based on off-the-shelf machines, but will be used with software adapted to the strict requirements of the Israeli security services.
The system is due to be fully implemented when the new terminal at Ben-Gurion is opened, scheduled for 2003.
Source: Flight International
