The reasons El Al won’t be part of a global airlines alliance anytime soon

During the recent strike by Histadrut, the Israeli labor federation, over a European open skies agreement, Israeli national airline El Al issued a statement arguing that its ability to effectively compete with European carriers has been hurt because global airline alliances have rebuffed the airline’s attempts to join one of them.

“Most carriers flying to Israel are part of a large international airline alliance,” the Israeli national carrier stated. “EL AL has been trying to become a member, but for obvious political reasons, has not been accepted. The fact that we are not able to join an alliance severely restricts our global operations and destinations served.”

Politics certainly plays a strong role in keeping El Al out of the global alliances, and could be the strongest reason for the rebuff. After all, Royal Jordanian is a six-year member of oneworld, although Israeli-Jordanian relations are fairly good, and Qatar Airways is a member-elect; Saudi Airlines belongs to SkyTeam, and the Star Alliance counts Turkish Airlines, which flies to Tel Aviv, as a member.

Meanwhile, several European countries, notably France, which has Air France in SkyTeam, likewise have been vocal critics of Israeli policies toward the Palestinians.

Politics, network limitations or both?

But does El Al’s ostracism from the major global airline alliances merely have a political subtext or is there more to it?

Representatives of oneworld, SkyTeam and the Star Alliance declined to comment about El Al in particular, but they tell Skift that any airline seeking membership needs to prove to the alliance that the carrier has a route network that enhances the route connectivity for the alliance as a whole.

The strong implication is that El Al, which flies to 35 destinations from Israel, and has only a handful of codeshares, doesn’t necessarily fit the bill.

A oneworld spokesperson, Michael Blunt, went so far as to say that the alliance already has the slot taken.

“Royal Jordanian, which is based in Amman, joined one world six years ago after being elected on board around 18 months earlier, as oneworld’s representative in that region,” Blunt said.

SkyTeam offered the same line of reasoning about the necessity of offering complementary networks, as well.

“SkyTeam is moving its focus from growing network scale to increasingly developing customer services that deliver seamless travel while lowering costs through synergies,” said spokesperson Chris Karanja.  “However we welcome partners so long as the new members enhance value for our passengers.”

Karanja of SkyTeam had more to say on the topic:

“For any potential partner to enter SkyTeam we will first analyze the complementarity of the networks and traffic streams to see if it creates a win-win situation for both parties involved.

 

“Today, we are looking at markets that are currently not being served by our members, but to which the membership has an interest because many of their customers travel to these parts of the world.  Two clear examples being India and Brazil.”

El Al offers Tel Aviv-New York-Sao Paulo service, but only through codeshares with American Airlines and Tam Airlines. El Al also offers a limited number of direct flights from Tel Aviv to Mumbai, but the service to Sao Paulo and Mumbai undoubtedly wouldn’t move the needle for SkyTeam’s ambitions in these regions.

No vacancies for El Al

It’s basically the same story from the Star Alliance, with spokesperson Markus Ruediger saying:

“Membership in Star Alliance has to be beneficial to the Alliance overall and to the individual carrier. In order to achieve this, a new member airline would have to bring in additional destinations (complementary network) into the Alliance as well as a strong home market.

 

“By the same token, the new member will only be able to maximize the alliance benefits, if it can offer attractive connecting points where passengers from other Alliance carriers can transfer onto this network.”

Another factor playing against a potential El Al membership in a global airline alliance is the country’s tough antitrust laws, which El Al states “are much stricter than in European countries, making it almost impossible for El Al to maintain codeshare agreements with the same flexibility enjoyed by European carriers.”

El Al’s stringent security procedures also have an impact.

Henry Harteveldt, Hudson Crossing’s travel industry analyst, concedes that any alliance that has airline members from the Middle East — and they all do — isn’t likely to welcome El Al.

For example, consider the problem of alliance members’ citizens flying to one another’s countries. For example, if Israel were to join SkyTeam, then consider that Israel classifies Saudi Arabia as an enemy state and bars its citizens from traveling to Saudi Arabia. Likewise, Saudi Arabia bars Israelis from entry.

And, although Saudis can in theory travel to Israel, they would certainly have a very difficult time getting visas and would be under intense scrutiny.

An Israeli entry into SkyTeam is therefore not on the agenda.

On the purely operational side of things, although El Al doesn’t offer a “true hub-and-spoke system from Tel Aviv, that market is an important market for business and leisure travelers, Harteveldt says, adding that the Israeli airline would add value to any of the alliances.

El Al already has codeshares with oneworld members American Airlines, Iberia, and S7 Airlines, and given members’ British Airways and American Airlines’ presence in London, oneworld would be the logical choice for El Al if it were to gain entry into an alliance, Harteveldt says.

Addison Schonland, managing director of Avintel Consulting, concurs that oneworld membership for El Al would make the most sense, with El Al’s “quiet relationship” with American Airlines providing an opening.

Saudi’s membership in SkyTeam would seem to block that avenue, Schonland says.

Schonland argues that El Al could provide any alliance with a “captive market,” the Jewish traveling public and others who prefer to fly, out of security concerns or cultural allegiances, to fly with the carrier.

But, it appears as though El Al will have to compete outside of the alliance framework in the short-run, at least.

David Wardell, a consultant at Technical Reality, argues that El Al’s banishment from global airline alliances stems from a combination of reasons.

“El Al is a tiny carrier and it’s challenging for other alliance participants to see ways in which they substantially enhance an alliance,” Wardell says. “Further, political constraints probably make the quest for added value almost impossible. Those issues won’t be resolved anytime soon.”