Flying High: Early Tisha B'Av and Weak Dollar Bring Smiles to Israel's Tourism Industry

The economy may be in the doldrums, but Israelis are traveling abroad in near record numbers.

The economy may be in the doldrums this year, but conditions have been quite favorable for the travel industry. The Tisha B’Av holiday came in early ‏(July 15‏) this year, adding extra time to the travel season, while the dollar is weak, cutting vacation costs for globe-trotting Israelis.

For Israelis, the summer travel season doesn’t begin when schools end, but after the mournful holiday commemorating the destruction of the Temple is over.

“Until Tisha B’Av it was relatively calm, but the day after, all the dams burst open. It’s insane,” says Dori Shoshan, marketing manager at Israir, adding: “The number of calls to the booking centers climbed substantially compared to the previous three weeks.”

For the travel industry, the holiday timing was especially good this year, says Eyal Kashdan, CEO of travel agency Flying Carpet. The Jewish calendar is based on the lunar year, so the timing of holidays varies from year to year. Not only did Tisha B’Av occur early in the summer, but it means that the High Holiday period of back-to-back vacations for Rosh Hashanah, Yom Kippur and Sukkot will kick off in early September.

“This year Tisha B’Av fell in the middle of July, as opposed to last year when it fell at the end of July,” Kashdan explains. “In effect, this lengthened the vacation period to two weeks more than last year. The period is not only characterized by bookings for the summer but also by reservations for the High Holiday period, which is already getting very close.”

“We’ve been discerning a trend this year − which last year was in its infancy − of several families traveling together for a beach vacation, which creates a group of 20 to 30 people arriving at the same club resort,” says Dana Lavie, marketing vice president at the Daka 90 travel agency. “It happens at both expensive and cheap hotels. So what we’re used to seeing mainly in ski vacations is now happening with [summer] vacation getaways.”

Einat Yanai, marketing director at El Al, says he has seen a small uptick in air travel this summer despite a slowing economy. The top destinations remain the classics − New York, Bangkok, London, Paris and Barcelona. “Demand is strong,” he says.

Kashdan observes that the drop in the dollar versus the shekel − by about 10% compared with last summer − is encouraging Israelis to choose to vacation abroad. But while the dollar is cheaper, Israelis still try to lower their vacation costs, says Shoshan.

“This year we’ve noticed a trend of travelers moving up their vacation to June, because they caught on that the prices are lower,” she says. “For a long time the Israeli customer has been buying more according to price than by the destination or hotel name. This trend is growing stronger with the economic situation worsening.”

Many travelers are price-oriented and indifferent about the destination or specific hotel, confirms Lavie. “While in 2009 we could see inelastic demand for specific hotels, customers today don’t ask for any particular hotel but are looking for someone good and cheap.”

Daka 90, which specializes in offering flights and hotels for people willing to travel on very short notice, reports that “last-minute” is no longer two or three days before the flight. For nearby Mediterranean destinations, last minute means “from today to tomorrow.

“In recent years it was mostly singles and couples who bought deals ‘from today to tomorrow,’ but now we also see families doing it,” says Lavie. “We open these bookings at 6 P.M., and the following day dozens of people are already at their destination.”

In an effort to save on travel costs, many Israelis will also be going abroad during the last week of August, after the kids are back at school. “Vacations during that week tend to be booked more often at the last minute, when demand and prices are lower,” according to Ariel Atias, CEO of Walla Tours. “Prices for the last week of August haven’t stopped going down yet, and prices will still drop. Right now there aren’t too many bookings for that week, which is normal.”

Rampant competition

Despite the favorable exchange rate, Israelis aren’t giving up on domestic travel this summer. The Crowne Plaza chain reports a 90% occupancy rate at its Eilat hotel for July, compared with 82% last year. Reservations for August are coming in at a good clip, according to Shai Asia, the chain’s marketing vice president.

“After Tisha B’Av we had a flood of phone calls and inquiries through agents and from membership club customers,” he says. “The pace over the past three days is fabulous. I don’t want to sound too optimistic, but it’s more than we planned for. If it continues this way, it will be one huge bonanza.”

Asia expects occupancy at the Eilat hotel − which is currently 56% − to reach 88% in August, and that occupancy in Ashkelon, currently 40%, will reach 72%.

Roni Aloni, marketing vice president at Fattal Hotels, confidently predicts that occupancy rates will exceed 90% at the group’s hotels in Eilat for July and August, although right now it’s at 70% to 75%. Rafi Baeri, marketing and sales vice president at Dan Hotels, says the chain’s occupancy rate is 76% so far this month, about 10 percentage points higher than in July 2012. According to Baeri, in August it will likely be similar to last year’s 75%.

“Despite the economic situation, this year’s summer season is enjoying strong demand,” says Israir CEO Uri Sirkis. “Among other things, it’s due to the low dollar exchange rate and rampant competition, which has been expressed by more seats being offered, and is leading more and more Israelis to fly abroad.”

On Sunday, for example, more than 61,000 passengers were expected to pass through Ben-Gurion International Airport on 373 flights. Israel Airports Authority forecasts that over three million travelers will be using the airport in July and August, 5% more than the same time last year − including 1.54 million in July and 1.65 million in August.

The economic situation has led airlines in Israel to offer a variety of new vacation destinations this summer at attractive prices, mainly around the Mediterranean basin, according to Gadi Tepper, CEO of Arkia Israel Airlines. This month, for example, Arkia introduced a new destination in Italy − the region of Apulia, on the heel of the “Italian boot,” bordering the Adriatic Sea. The carrier offers a weekly flight to the region’s Brindisi Airport.

This summer Israir added Lisbon as a destination, as well as a new route to Munich, says Sirkis. Tourism wholesaler Kavei Hufsha, together with the El Al charter subsidiary Sun d’Or, started operating a weekly flight this month to Zurich, following increased demand. Hila Dor Samuelov, manager for Europe at Kavei Hufsha, says demand for Swiss destinations has been rising about 10% a year.

Direct charter flights by Kishrei Teufa, through Meridiana Airlines, have begun operating this summer from Israel to the island of Sardinia, three hours away by plane. Kishrei Teufa has also introduced another Italian destination: Calabria, at the foot of Italy.

Antalya in Turkey has made a comeback this summer among Israelis. “Many families are flying to Antalya in addition to the traffic we’ve become accustomed to from the Arab and Russian sectors,” says Shai Fredo, CEO of KTA International, which represents Turkish charter companies in Israel.
About 53,000 passengers made return trips between Ben-Gurion airport and Antalya in June, 24% more than in June 2012 according to the Israel Airports Authority. From January to June, around 126,700 passengers flew from Ben-Gurion airport to Antalya and back, a 32.7% increase over the same period the previous year.
 

Moshe Gilad