The Israeli Tours package plans Kavei Huffsha (holiday lines) to establish a new Israeli airline. The company, which already owns the Greek Airlines and Cypriot Air Company, will focus with the new airline on short flights to destinations within four to five hours of Israel.
The process of establishing new airlines is complex and lasts for at least 18 months, with licensing procedures with the Civil Aviation Authority in Israel (CAA) listed in the operation that is likely to take six months. If everything happens as planned, the company will consider purchasing or renting aircraft on a dry rental contract, where the plane is rented without a crew, and flights will be operated by Israeli crews. This process is currently in its early stages, and Kavei Huffsha has not started after the license process with CAA.
It is restricted as European airlines
Kavei Huffsha has European airlines, but because they are European, they are limited to flights operating from Israel to Europe only. This restriction is not allowed to expand destinations outside the continent, such as Georgia or Dubai – the destinations currently targeted by the company.
The airline will also take into account the potential expansion of Ibrahim’s agreements, and the day that the Israelis are allowed to fly to Saudi Arabia.
The restrictions imposed on European airlines stem from Israel’s bilateral aviation agreements, which are designed to protect local airlines and reduce foreign companies’ activities on roads that compete directly with Israeli companies. These agreements also limit foreign companies the right to operate flights between countries other than their homeland.
For example, a European airline cannot operate direct flights from Israel to countries in Asia or Africa, because destinations are not part of its home country. The main purpose of these restrictions is to maintain fair competition and prevent foreign companies from excessive exploration of the local market.
The Hungarian airline Wizz Air is working on direct flights from Tel Aviv to Abu Dhabi. But this is due to the structure of Wizz Air Abu Dhabi, a registered and organized company in the United Arab Emirates.
The processes of blue and tus birds increased from appetite
Kavei Huffsha, owned by Ami Cohen and Arnon England, is one of the largest tourism companies in Israel. The Blue Bird Greek Airline has been owning since 2016, and in March 2024 it has a 33 % stake in Cypriot Airline Tus. Earlier this month, I completed the acquisition of all TUS shares. The group also owns tourism sites 90 minutes and Blik Tourism.
Over the past year, Kavei Huffsha has witnessed a significant increase in the activity of its airlines. Blue Bird rose from 11 to six in terms of market share at Ben Gurion Airport, with a 24 % increase in the number of passengers that were carried compared to 2023. TUS rose from 23 to eighth, with an increase of 10 % in the number of passengers.
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Over the past year, companies have worked relatively to and from Israel, with the exception of a brief stopping after the European Aviation Safety Agency (EASA) recommended last September to avoid flights to Israel. This recommendation led to a large wave of cancellation, which continued until the ceasefire with Hezbollah at the end of November. TUS was the first company to resume flights to Israel after submitting the recommendation, after the pressure practiced by Kavei Huffsha in the Cypriot Air Authority.
“The new company will operate, upon its establishment, along with Blue Bird and Tus, whose regular operations will continue with flights to Israel. We are proud of Blue Bird and Tus, which was the only foreign airline that continued to Flying to Israel last year.
Is the Israeli market ready for another airline?
Currently, there are four Israeli airlines operating in Israel: EL Al (including Sundor Subcommittee), ISRAIR, Arkia and Air Haifa. The latter started the operations last year, at a time when the presence of foreign airlines in Israel was little.
Initially, Air Haifa was unable to operate flights from its original airport in Haifa, due to the closure of the airspace and the war in the north. Now, after several months of operations, the company runs direct flights to Larnaca, Athens and Eilaat from Haifa Airport.
Air Haifa into the market was good news, especially for the population of the North, although the aviation industry has doubts about the operating model. The company continues to work and develop, perhaps specifically because it is the only operator from Haifa Airport.
Unlike Air Haifa, a new airline operating from Ben Gurion Airport will face a complex competition from companies such as Sundor, ISRAIR and Arkia, which runs roads on destinations outside the European Union such as Georgia and the United Arab Emirates.
Market sources are skeptical that a flight company focuses on nearby destinations outside the European Union will be attractive enough, because the possible destinations for short flights from Israel are limited.
Possible destinations include Moldova, the Balkan countries that are not in the European Union, Albania, the United Arab Emirates, Ethiopia, Kenya, and if the airspace over Oman is also open – India and Sri Lanka.
Regarding countries such as Turkey, Egypt and Morocco, which falls within the range of aviation, it is unlikely that an Israeli company will work on their flights in the foreseeable future for security reasons. However, if the company is working on an ISRAIR’s model, as a tourist company that also runs a flight company, this makes the feasibility of economic success higher.
It was published by Globes, Israel Business News – En.globes.co.il – on January 29, 2025.
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