New Airline Launches Amid El Al's Controversy

Israel's aviation sector is undergoing a period of significant changes amidst a war environment.

Air Haifa, a new low-cost airline and the country's fourth commercial carrier, has received its operating license and began flights on Monday with an ATR72-600. The airline, based in Haifa, plans to connect northern Israel with destinations such as Eilat and Larnaca. However, due to the current security situation in northern Israel, the inaugural flights to Eilat will launch from Ben Gurion Airport instead.

The aircraft will feature an all-economy layout with 72 seats arranged in a 2-2 configuration.

This launch comes at a time when El Al, Israel's national carrier, is under heavy scrutiny. According to El Pais , El Al garnered widespread support after the war started for adding flights to bring reservists back to Israel. The airline even flew on the Sabbath for the first time since 1982, citing the Jewish principle of pikuach nefesh — overriding religious rules to save lives.

As the conflict escalated, most foreign airlines canceled their routes to Tel Aviv, leaving El Al as the primary carrier operating in and out of the country. Despite this show of solidarity, the airline has faced backlash for steep fare increases, which have frustrated many Israelis who feel exploited.

While El Al has reported record earnings, with second-quarter profits reaching $147.4 million, it has come under investigation by the Competition Authority for potentially abusing its monopolistic position. Public discontent has led to intervention by the Minister of Economy, who negotiated fixed prices on select routes. Meanwhile, El Al's share prices have surged, bolstered by increased demand and a weakening shekel due to political instability.

Air Haifa's entry into the market may offer a new alternative for travelers, especially on domestic routes. If security conditions permit, flights from Haifa to Eilat and Larnaca will commence in mid-October, providing more options for travelers at a time when El Al's dominance faces scrutiny.