Court Document Reveals Arkia's Fall

A document obtained by TheMarker yesterday reveals just how dire the Arkia airline's situation is. "Arkia's economic situation is really bad and, in the last few years, has suffered stinging losses," the document stated.

The company lost $9 million in 2005 and expects to lose $7 million this year, according to the document, which was submitted as an affidavit to the regional labor tribunal in Tel Aviv ahead of a hearing this Sunday. The tribunal is hearing the petition of four of the company's stewardesses who were laid off.

The document states that Arkia cut the number of its employees from 787 in November 2005 to 575 in November 2006.

Arkia reported in the media in early December that it had signed a $366 million deal to acquire to Boeing 787 jet airliners with an option to acquire another two.

However, according to the court document, the jets were not purchased by Arkia, but rather by the Jordache Enterprises, which belongs to the Nakash brothers who own Arkia.

"Another indication of the decline of Arkia's status is the number of stewards' flight hours," the document explained. "During the first 11 months of 2005 there were 61,125 flight hours for stewards while there were only 57,028 flight hours during the first 11 months of 2006, representing a total decline of 7 percent."