MIAMI – Israeli flag carrier El Al Israel Airlines (LY) has announced all flights and other operations have been suspended. The announcement comes in a turbulent time for the airline, with Q1 cash loss and workforce union disputes.

El Al CEO Gonen Usiskhin ordered all aircraft to return to Israel, and the airline is reportedly refusing to rebook US passengers, citing complaints with the US DOT against LY.

“Rehovot” in the retro livery departing LAX
Photo: Luca Flores

Financial Difficulty

The airline lost USD$140m in Q1, a period lasting from January to April, and only about half of that time was affected by the pandemic. Losses are expected to pile on during Q2 for what is already a financially weakened airline.

Revenue for the airline dropped 25% after Israel closed its borders and returning residents were required to quarantine for fourteen days.

Photo: Roberto Leiro

Workforce Disputes

The airline is bleeding cash and trying to secure state funding, but problems have been around for the airline for a while, including an unnecessarily large workforce and high salaries.

As financial losses keep coming, the Pilot union for El Al says the airline has failed to meet its requirements. This dispute was fueled by the airline’s refusal to transfer 30 Pilots from the Boeing 737 to the 787, which would cost LY money to retrain said Pilots.