The International Air Transport Association (IATA) has issued a dire warning for Israel’s aviation industry, saying further delay to the restart of air travel could result in the loss of 95,000 jobs in the country. Israel’s flag carrier, El Al has pushed back the resumption of normal passenger services until at least July 31, while other international airlines are cautiously restarting some flights to the country despite border restrictions put in place because of the COVID-19 pandemic.
IATA claims passenger numbers to the country will plummet by 55 per cent in 2020, costing airlines some $3.2 billion in lost revenues. The wider impact on the Israeli economy could cost the country as much as $8.3 billion according to the global airline lobby group.
“Airlines in Israel are suffering an unprecedented collapse in revenues, and in order to preserve air connectivity, it’s vital that Israel follow the lead of many other governments and provide financial assistance to the industry,” explained Rafael Schvartzman, IATA’s Regional Vice President for Europe.
In comparison to the multi-billion dollar bailouts some countries are offering their flag carrier airlines, the Israeli government is still negotiating with El Al on a proposed $250 million loan for the embattled airline. The bailout, if approved, would result in Israel taking a 60 per cent majority stake in the loss-making carrier.
El Al continues to operate some cargo-only and passenger repatriation flights but regularly scheduled flights have been suspended because of a 14-day quarantine requirement imposed by Israeli authorities.
“Our latest passenger survey shows that 83% will not travel if a quarantine is in place. Therefore, if the Israeli government is looking to restart the economy, it needs an alternative risk-based solution,” Schvartzman continued.
“Quarantine measures are a huge impediment to a recovery in air traffic.”
On a global scale, IATA now estimates that airlines will collectively post a mammoth loss of $84.3 billion in 2020. Financial assistance is, the trade group claims, a vital lifeline that many airlines will need if they have any hope of surviving the winter season.
“People are returning to the skies but the horizon of uncertainty of the COVID-19 crisis is extending,” IATA’s director general Alexandre de Juniac said last week. A recent survey found only 45 per cent of travellers would be willing to return to the skies within the first few months of the pandemic subsiding, while bookings are down 82% year-on-year compared to June 2019.
Juniac suggested governments had until July at the latest to prevent a tsunami of airline bankruptcies.
Around 6,000 of El Al’s 6,500 staff remain on unpaid leave until July 31 pending the restart of flights. The carrier has warned that thousands of redundancies will be required to help the airline survive the crisis.
