Dei'ah veDibur - Information & Insight

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4 Sivan 5762 - May 15, 2002 | Mordecai Plaut, director Published Weekly









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Airlines Prepare for Summer Price War in Israel
by Yated Neeman Staff

Foreign and Israeli airlines have recently announced price cuts on airfares and holiday packages for May and June, apparently heralding a trend toward lower prices for the summer months.

Lufthansa, for example, is offering a pair of round- trip tickets on its Israel-New York-Boston line for $1,999. British Airways' round-trip fare on its route from Israel to New York, Philadelphia or Chicago is just $777.

Although airlines often lower their prices during April and May -- the slow period between Pesach travel and the high- demand months of July and August -- a new factor has changed that picture this year: the dearth of travelers to and from Israel.

Industry estimates regarding low passenger forecasts for the next three or four months are based on the current situation. From January 1 to April 14, 2002 there was a 12.6 percent decline in international passenger traffic through Ben-Gurion Airport.

The main reason for the expected reduction in passenger traffic this summer is the prolonged security situation. It is already clear that tourists will not be coming from abroad. Most tourists, particularly Europeans, plan their holidays well in advance.

The airlines are also expecting a drop in outgoing tourism. Reserve duty is having an effect on Israeli travel abroad.

Reduced outgoing tourism , already evident during Pesach, will probably affect travel abroad for Shavuot.

The difficult economic situation in Israel will also affect outgoing summer trips.

Competition between the airlines over smaller number of summer travelers will be aggressive.

Another marketing gimmick being employed by the airlines is special attractions on flights. The Dutch airline KLM, for example, has announced a Spanish food festival in its business class until May 31 on all intercontinental flights originating in Amsterdam, including to Israel.

Improved service and upgraded equipment on planes will be another focus for attracting passengers and will be highlighted in the airlines' advertising campaigns.

Passengers on Continental Airlines' international flights, for example, will enjoy more comfortable "business first" seats.

Despite the drop in tourist traffic -- both now and that anticipated in the summer -- there has been no change in flight schedules of most of the foreign airlines that fly to Israel. Only American Airlines has canceled the addition of three flights per week that were to commence in May on its U.S.-Israel route.


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