Fred Lazar has never flown on El Al, but the Toronto aviation expert thinks the flagship Israeli airline may just have squandered much of the goodwill it established among generations of Canadian passengers.
According to Lazar, who teaches economics at the Schulich School of Business at York University, the Toronto market was probably one of the most important ones in El Al’s schedule after New York, Miami, and London, England. At least, before COVID grounded international travel.
When flying resumed, the new owners of the airline looked at current fuel costs and widespread shortages of pilots and crews, made a pledge to downsize the fleet, and pulled the plug on the non-stop route from Tel Aviv to Toronto—after nearly 40 years.
“They may realize in three or six months afterwards, that maybe, in retrospect, it was not the right decision,” Lazar told The CJN. “Even if they decide to return, probably in the late spring, or next summer, they will have lost the loyalty of a significant amount of this market, and that’s why they may learn to regret it.”
Although 100,00 Canadians travelled to Israel in 2019, many on El Al, pandemic lockdowns in both countries interrupted regular travel for two years.
He does think another airline will jump in to provide service to Tel Aviv and compete with Air Canada.
Cancellations likely for bar mitzvah
But that won’t happen soon enough for Toronto’s Reena Ostro and her family.
Ostro’s oldest son Adriel, 12, was set to put on his tefillin for the first time in Jerusalem during a pre-bar mitzvah ceremony at the end of December. Not only had Ostro already booked the time spot at the Western Wall for the event, but she also reserved the shofar blowers and the restaurant.
Ten members of her family already have tickets with El Al.
Last week, El Al emailed customers who have already booked tickets for trips after the last Toronto to Tel Aviv flight which ends on Oct. 27.
In the email, El Al also said it wants to fly to new “exciting” destinations.
Passengers who hold tickets are being offered several options, including rebooking to other destinations, flying to Ben Gurion airport via connecting flights in the United States or Europe, or even cancelling and receiving a voucher for future travel.
When she learned the airline would no longer be flying directly from Toronto, Ostro reluctantly decided to cancel.
“Talking about snow storms, bad weather, flying [with four kids] through New York, or anywhere, is just really just not possible, right?” she said, adding that the family would also lose so much time out of their week-long overseas trip.
Ostro said aside from the logistics nightmare, if she switches to fly directly on Air Canada during the last week of December, it would have pumped up the cost of the airfare by close to $3,000. Both Hanukkah and Christmas fall during the week of their trip, when demand is strong from Christians and Jews alike who want to visit the Holy Land.
While her son’s actual bar mitzvah won’t be until February, it will now likely take place in Toronto without the long-awaited rite of passage at Judaism’s holiest site.
“He’s always dreamed of having his bar mitzvah in Israel. We promised him,” Ostro said. “So as of now, it does not look hopeful.”
Ticket prices on Air Canada will rise
Artzi Korostelev, executive vice-president of Peerless Travel in Toronto, says the issue is not re-booking travellers on now cancelled El Al flights, but the fact that prices have jumped significantly.
“We’re finding alternatives for them. They understand they have to be more flexible. What is difficult is that the prices are extremely high, so there’s a lot of frustration to fend off.”
Peerless is the largest El Al re-seller in Canada and had been in partnership with the airline for more than 30 years, he said. The agency sends over 10,000 travellers a year from North America to Israel.
Fares have risen recently, not because of El Al’s decision to leave the Canadian market, but due to high demand for flights.
But in the long run, having just one airline, Air Canada, providing non-stop flights to Israel from Canada is worrisome, he said.
“When an airline is not competing with anyone on a specific route there’s no incentive to keep rates in check, there’s no incentive to keep perks and sales.”
Jewish travellers patronized El Al because they appreciated that the meals on board were kosher, the airline didn’t fly on Shabbat and offered extra levels of security.
People who still want to fly El Al, usually for religious reasons, will likely travel through New York, which is problematic because of cancellations and congestion in New York airports, he said.
Those looking for a cheaper flight will have to forego the convenience of a direct trip and look at connecting through Europe.
Religious travel impacted
El Al’s decision has also disrupted plans for Christian travellers who liked to fly on the Israeli airline, Korostelev said.
“Especially for pilgrims that have been in Israel and support Israel and travel to Israel quite often…, they had grown accustomed to El Al service and they were extremely satisfied with the service out of Toronto. We’ve heard from many of them that they are extremely surprised and disappointed this is happening,” he said.
While travel has not bounced back fully since COVID, the travel agency has seen strong demand for winter and spring travel to Israel, Korostelev said.
“We do expect Air Canada to step in and fill in the gaps, meaning increasing their weekly frequency of flights. We recommend for them to do it sooner rather than later.”
With Air Canada now cornering the market as the only airline offering direct service, experts expect the Canadian carrier will be free to raise ticket prices on flights to Israel by as much as 10 to 20 percent, according to Lazar.
Like all airlines, Air Canada uses an algorithm that monitors demand, and adjusts ticket prices accordingly, he said.
“What you’re going to find is the cheapest economy fares disappear, the other economy fares will increase and, with jet fuel prices, there is an even stronger incentive to increase those fares,” Lazar predicted.
He doesn’t see Air Canada adding any additional flights to Israel, because of staffing problems. Indeed, the Canadian airline announced June 29 that it was cutting some routes in North America this summer to rebalance the available pilots and crews.
Harder to visit elderly parents in Canada
Flying on an airline that adheres to Jewish religious rules is one of the main reasons why Jesica Myers loves El Al. The resident of Ramat Beit Shemesh Alef immigrated to Israel 20 years ago from Toronto, but her parents still live in Toronto, as does one of her sons. She takes the red-eye after the Sabbath ends, to arrive in Canada early Sunday mornings.
As the owner of a ceramics business called Keramkli in Beit Shemesh, Myers had to pivot during the COVID pandemic, so she is upset that El Al decided not to wait any longer for volume to pick up on its route to Toronto.
“I’m a business owner. I’m still trying to recover from COVID,” she said. “If the travel industry is just getting up to speed and it’s going to take a few months, obviously, then why make such a drastic decision right now?”
Serious financial trouble
The El Al move isn’t out of the blue. The new owner, American health care entrepreneur Ken Rozenberg, told an Israeli news outlet in September 2021 that he would shed 1,500 more employees, and reduce the size of El Al’s fleet. The El Al website is currently showing over 50 planes operating.
“They are a relatively small airline, and so getting the right usage of every plane is extremely important in this competitive environment,” said management expert Opher Baron, of the University of Toronto’s Rotman School of Business.
According to Baron, El Al just did what it needed to do to get out of serious financial trouble in the short term. He points to the Toronto route having several challenges, not the least of which involves winter weather causing delays. But also, Baron explained, El Al doesn’t fly anywhere else in North America, after the plane and its crew lands in Toronto.
“When you don’t have much work to do with them, when they are idling, say in Toronto, because you don’t have any other flights from Toronto that you can use them for… you may find yourself paying too much to maintain one specific leg,” Baron said.
Still, he also predicts El Al will be back eventually because Toronto is a loyal and solid market.
“We’re a little bit of a captive audience in that if they come back, we will start using them again,” Baron said, although he cautioned El Al not to bank on smooth sailing if a third airline offers flights for the Canadian market first.
