New Israeli Government Plan to Boost Airline Competition and Strengthen Economic Ties with North America
As airfare prices between Israel and North America continue to soar, the Israeli government announced a new initiative that could bring relief to travelers. On Sunday, the government approved a joint proposal from the Ministries of Transportation and Finance, in collaboration with Economic Affairs Committee Chair David Bitan, to provide financial support to airlines that expand their operations to North American destinations.
The initiative aims to increase competition, strengthen business ties with the U.S. and Canada, expand flight availability, and ultimately reduce travel costs for passengers.
Rising Prices Amid the War
Since the outbreak of the ‘Operation Iron Swords’ war there has been a sharp decline in air travel to and from Israel, particularly on North American routes. With most foreign airlines suspending operations, El Al has remained the sole carrier operating direct flights. The resultant overwhelming demand has led to skyrocketing ticket prices.
$4 Million Budget for Airline Support
The government has allocated ₪15 million (~$4 million) to this initiative. According to the government’s decision, financial aid will be granted to airlines operating regular, direct flights between Israel and North America using wide-body aircraft.
To qualify, airlines must increase their flight frequency by at least two additional weekly flights per destination, compared to the last quarter of 2024.
A spokesperson from the Ministry of Transportation emphasized:
“The conditions for receiving assistance are designed to ensure that funds go toward increasing actual flight operations rather than subsidizing existing routes. This move is expected to encourage more airlines to enter the market and offer competitive long-haul flight options to North America.”
Strengthening Economic Ties with North America
According to the Ministry of Transportation, 78% of foreign investments in Israel originate from North America. Since the start of the war and the reduction in air traffic, there has been a 40% decline in flights to and from the U.S. and Canada. The government hopes this program will restore former levels of air travel and ensure more competitive pricing for consumers.
Ben Gurion Airport | Photo: Avshalom Sassoni/Flash90
Moshe Ben Zaken, Director-General of the Ministry of Transportation, stated:
“This decision will lead to increased flights, enhanced competition, and greater resilience in Israel’s international aviation sector.”
Minister of Transportation Miri Regev added:
“The Ministry of Transportation is committed to encouraging airlines to resume operations, especially on North American routes, which are crucial due to the strong economic ties between our nations.”
Bottom Line
With this new $4 million incentive, Israel hopes to expand air travel options, lower ticket prices, and strengthen its global economic ties—all while making it easier and more affordable for passengers to fly between Israel, the U.S., and Canada.
