January 3, 2018 / 9:05 AM / 4 months ago

Israel's El Al Airlines to start flights to Silicon Valley

TEL AVIV (Reuters) - El Al Israel Airlines (ELAL.TA) said on Wednesday it will begin nonstop flights between Tel Aviv and San Francisco in the fourth quarter, as it continues to expand into North America.

The logo of Israel's El Al Airlines is seen during a ceremony marking the arrival of the first of the airline's order of 16 Boeing 787 Dreamliner jets, at Ben Gurion International Airport, near Tel Aviv, Israel August 23, 2017. REUTERS/Amir Cohen

Israel’s flag carrier, which is facing increased competition from low cost carriers, said it will fly the route three times a week using new Boeing (BA.N) 787 Dreamliner aircraft.

It will compete with United (UAL.N), which launched flights between the two cities in 2016 to accommodate Israel’s flourishing high-tech sector. Passengers on business often fly between Silicon Valley and Israel, which is one of the largest global tech centers.

“The acquisition of the Dreamliner enables us to expand our long-haul network,” said David Maimon, El Al’s chief executive. “San Francisco is an important strategic city for El Al. Our target is to take the business segment.”

In November, El Al started nonstop flights to Miami from Tel Aviv, after starting flights to Boston in 2015. It also flies nonstop to New York, Los Angeles and Toronto.

The first of Israel's El Al Airlines order of 16 Boeing 787 Dreamliner jets, lands at Ben Gurion International Airport, near Tel Aviv, Israel August 23, 2017. REUTERS/Amir Cohen

Maimon said El Al plans to add more long-haul routes but a decision would likely not be made until later in 2018.

He said El Al would have liked to have started San Francisco flights sooner but it did not have the proper aircraft.

El Al in 2017 started to receive its delivery of 16 new 787 aircraft that will be delivered through 2020 to replace its ageing long-haul fleet, which the airline hopes will win back customers lost to competitors.

    Maimon is set to step down in a month after four years in the job. He told reporters that in the past four years, the number of El Al passengers rose to 5.7 million from 4.3 million, while its share price jumped.

    He said a new CEO is expected to be named in the coming days.

    El Al also said it was unifying all European flights under the El Al brand and retiring its low-cost brand UP that flew to five destinations in Europe.

    It plans to refurbish all of its Boeing 737 aircraft to Europe with new seats in economy and in business class. The alterations should be complete in 2019.

    It will also change its fare structure on European flights to include a less expensive “lite” option for those who wish to travel without checked baggage.

    The government on Tuesday said tourism to Israel rose 25 percent in 2017 to a record 3.6 million, buoyed by more 18 new routes flying into Tel Aviv and the Red Sea resort of Eilat.

    Reporting by Steven Scheer; editing by Jason Neely

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