Israel's national carrier El Al Israel Airlines said on Monday it had no intention of flying on the Sabbath and was still trying to defuse a crisis with ultra-Orthodox customers over the issue.
El Al has drawn the ire of Israel's ultra-Orthodox community, an important source of revenue, after recently flying several flights on Saturday - the Jewish holy day of rest - to clear a backlog.
This has resulted in growing calls by ultra-Orthodox Jewish leaders to boycott the airline.
The ultra-Orthodox community accounts for between 20 and 30 percent of El Al's passengers, and Israeli media have estimated potential loss of revenue of $300 million from a full boycott.
The firm's chief executive officer, Haim Romano, said talks were continuing with rabbinical leaders to resolve the issue.
"There is no boycott," he told reporters on the sidelines of Israeli business conference in Tel Aviv. "El Al has no intention to fly on the Sabbath."
"We have decided this issue is not on the agenda," he added.
Romano declined to comment on potential losses. "The ultra-Orthodox are our clients, and we intend to serve them," he said.
While El Al was a state-owned company it abided by demands from observant Jews not to fly on the Sabbath, which runs from sunset on Friday to sunset on Saturday.
El Al was privatized in 2004, and there had been some speculation that the airline would start flying on Saturday owing to competitive pressures from European and U.S. carriers, as well as smaller Israeli rival Israir.
But the carrier kept a taboo on Sabbath flights owing to a fear of losing religious clients.
The latest religious fall-out for El Al began in late November when, struggling to catch up with lost flights after a strike by Israeli airport staff, the airline flew several times late on Friday.
Israeli media reported that ultra-Orthodox leaders had demanded a written commitment from El Al that it would never fly on the Sabbath again.
Such a commitment would effectively make the airline beholden to Halakha, the strict body of Jewish law, but it remains unclear if the airline would be willing to sign a legally binding religious document.
Asher Sapir, an ultra-Orthodox client of El Al who was attending the business conference, said he would not fly with the airline at the moment.
"The rabbis decided that the national carrier needs to show that it is a Jewish carrier of the Jewish state," said Sapir, who heads a pension fund. "The rabbis have not signed any boycott of El Al."
"I hope the current situation will be resolved. Some rabbis have requested us not to fly El Al for now."
El Al has said it would post a yearly net loss. In November it reported a sharp decline in third-quarter net profit after a month-long war with Lebanese Hezbollah guerrillas in the period pushed tourism down by 31 percent.
El Al posted a quarterly net profit of $1.8 million compared with $52.2 million a year earlier. Revenue in the quarter fell to $447 million from $485.2 million.
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