El Al reports $55M loss in Q12019
El Al Israel Airlines reports $55 million loss ‒ approximately $11 million more than during the same period in 2018 ‒ in the first quarter of 2019. Continues fleet change, phasing out old Boeing 767s and taking in new 787 Dreamliners.
The company states poorer financial results were mainly due to later timing of Passover (falling in the second quarter this year) and increased competition, especially from low-cost carriers.
These factors outweigh the positive impact of 5% lower operating expenses, contributed by decreased fuel prices and consumption, as the carrier is introducing less fuel consuming Dreamliners to its fleet.
El Al is currently implementing fleet renewal, replacing older model aircraft, notably Boeing 767-300ERs, with 16 new Boeing 787-9 Dreamliners. Due to the change, and to the new pilot regulations (FTL), the company had to adjust “the volume of activity”.
El Al operates an all-Boeing fleet of 43 aircraft, planespotters.net data indicates. It shows that all seven Boeing 767-300ERs are already phased out, the data indicates. Of the 16 Dreamliners, El Al has already received nine 787-9s.
El Al’s revenues were down 7% to $429 million (in comparison to $460 million in Q1 2018) in the first quarter of 2019.
"The timing of Passover, which occurred this year during the second quarter, caused the demand to be diverted to the second quarter of 2019,” according to EL AL's CEO, Gonen Usishkin, quoted in a statement. “Revenues were also affected by the competition, mainly on the routes to the Far East and Europe, in particular vis-à-vis Low-Cost airlines. Furthermore, during interim period, while fleets are being replaced, the Company's operating efficiency is impaired [...]”.
El Al is expanding its route network. Besides the previously launched new routes to Niece (in March 2019), San Francisco and Manchester (both in May 2019), the airline is also adding Las Vegas (in June 2019), Chicago (March 2020) and Tokyo (March 2020) to its destination list.
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