“There will be direct flights from Tel Aviv to Abu Dhabi and back. It’s a short, three-hour trip, like Rome,” Prime Minister Benjamin Netanyahu said on Monday as he toured Ben-Gurion International Airport ahead of resumed air travel to a select group of countries.
Netanyahu needn’t have touted the attractions of the Gulf: From the moment Israel and the United Arab Emirates announced they were establishing diplomatic relations, many Israelis were fantasizing about a Dubai vacation.
No wonder, the UAE offers hotels that are so luxurious that they are rated seven stars, sandy beaches, megamalls and attractions that have only been accessible to Israelis through videos and television shows. Israeli travel agents, battered by the coronavirus pandemic, are anxious to start selling tickets and package deals.
But for Israel’s airlines, including flag carrier El Al, the prospect of UAE tourism is could be an opportunity or yet another blow for an industry that has struggled with Open Skies competition and the coronavirus. They now face competition from two powerful UAE rivals – Emirates and Etihad Airways – with their unrivaled service and vast global networks.
Emirates, which is ranked among the five best airlines in the world, boasts a giant fleet of more than 250 aircraft and a network of some 180 global destinations. Etihad has also won prizes and has a fleet of 116 planes. Its business class is world-renowned.
“Abu Dhabi airlines offer an attractive product that will most certainly present a challenge to Israeli carriers,” said Uri Sirkis, CEO of Israel’s No. 2 airline, Israir. However, he said the real competition will be between the Gulf carriers and two foreign airlines that service Israel – Turkish Airlines and Royal Jordanian – because Israeli airlines haven’t been able to effectively compete on eastern destinations, whether it’s East Asia now or the Gulf in the future.
Although it has allowed Air India to fly over Saudi territory on its New Delhi-Tel Aviv route since 2018, Saudi Arabia’s airspace is closed to Israeli airlines. On Monday, Netanyahu said he was negotiating to allow Saudi overflights but gave no time frame.
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“We are currently working on enabling direct flights, over Saudi Arabia, between Tel Aviv and Dubai and Abu Dhabi,” he said.
Sirkis said that if Netanyahu succeeds it would be a game-changer because it would shorten flight times, reduce costs and make destinations more accessible for Israeli airlines.
In order to fly to Dubai in three-and-a-quarter hours, you have to fly over Jordan and Saudi Arabia, Sirkis explained. Because Israeli carriers have to go around Saudi Arabia, it takes them on average three hours longer to fly to India or Thailand. The same rule would apply to Gulf flights.
Because Israeli airlines are effectively out of the picture, Sirkis said it would be foreign carriers that face a head-on challenge from the Gulf airlines and will be the ones to lose market share at Ben-Gurion. That could give Israeli airlines a boost by weakening the competition.
Another airline executive, who spoke on condition of anonymity, said Israeli carriers, especially El Al, would face stiff competition from Emirates and Etihad on flights to Japan, Hong Kong, Thailand, India, Sri Lanka and the like. But he also said he saw room for codesharing and other cooperation between Israeli and Gulf carriers.
“For instance, you could fly to Dubai with El Al and take a connecting flight with Emirates to a destination like Japan. The ticket would say El Al for the entire journey but the carriers would split the profits based on kilometers or based on a fixed price,” he explained.
In the end, the executive said, competition with Emirati carriers is no different than any other one. “American Airlines and Delta have increased the competition. When United started flying to Chicago [from Ben-Gurion], it wasn’t a challenge for El Al? Of course, it was. Almost every big global airline has a better network than El Al.”
At this stage, it’s unclear when Israelis will be able to actually fly to the UAE. Industry sources are betting it won’t be until well into 2021 and maybe even later. Even so, travel agents and tour packages are already looking forward.
Ronen Carasso, the CEO of Issta Holidays, sees the Emirates as a winter destination. “In the summer, the heat is horrible. Right now, it’s 52 degrees Celsius [125 degrees Fahrenheit] and that’s inhuman. The ideal time to go is November through March, which makes it an option instead of Zanzibar or Sri Lanka,” he said.
He said Israelis should be drawn to it the UAE as a holiday destination. “It’s a developed country, it has the sea, terrific malls, the best hotels in the world, including one that is rated seven stars, one of the only ones in the word,” said Carasso.
“Most of the hotels offer attractive rates. From what I’ve seen, you can get a package of four or five days at an exceptionally good hotel for $300 to $600 per person in a double room. That’s cheaper than Paris and a little more expensive than Georgia.”
Sirkis agrees, saying he believed package deals could run at $499 per person for three nights and for $700 for five nights. “In 2019 when we flew to Azerbaijan, we branded it as the ‘Dubai of the Caucasus’ and had 25,000 passengers in a year. So think what it will be like to offer flights to the real Dubai? There is sure to be a double demand if not more,” he predicted.
Ephraim Kramer, the CEO of Eshet Tours, said it would take time to develop. “I think because of the issues of health and politics it won’t happen immediately, certainly not in 2020. Maybe next year, maybe a little later, but it is certainly an attractive destination because it offers an inexpensive, top-notch experience,” he said.
With all that, however, Sirkis warns that one of the vacation dreams everyone is talking about now will be realized. “We really hope that Dubai will emerge as a safe and secure destination, but we need to remember that we have signed peace agreements with Jordan and Egypt and Israeli airlines still don’t fly to Sharm el-Sheikh or to Cairo because of security issues for Israelis who go there,” he said.