Ben Gurion Airport
Planes lining up for take off at Ben-Gurion Airport, April 2010. Photo by Moti Milrod
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At least one industry appears to be bucking the trend of greater market concentration in Israel - the airline industry.

According to an internal Transportation Ministry report, competition in the airline industry increased in 2010, and the trend is expected to continue.

One of the indicators used to measure competition in the industry is the number of routes that are flown by at least three different airlines. Currently, there are nine; in 2008, there were six; and in 2006 and 2007, there was only one.

A main factor behind this increase was the decision by foreign airlines to increase the number of flights and seats on their routes to and from Israel.

Another factor was the increase in the number of low-cost airlines that started flying to and from Israel. Chief among them is Easy Jet, which runs two flights through Ben-Gurion International Airport every day.

Between 2007 and 2008, 25 airlines introduced regular flights to and from Israel. But 10 of those airlines have since discontinued those routes.

This dynamic - a large number of new companies entering a market and then withdrawing - characterizes a competitive market.

Charter flights also played a role in stepped-up competition, as a significant number of the charter flights to and from Israel fly routes already flown by standard commercial airlines.

According to the report, submitted to Transportation Minister Israel Katz, after increasing in 2007 and 2008, the number of travelers entering and leaving Israel dropped in 2009 but then popped back up again in 2010.