Eilat's new airport set for first full winter season

Eilat's Ramon airport / Photo: IAA Spokesperson

Despite incentives from the Tourism Ministry, there will only be 45 flights a week landing at the new airport, down from 55 last winter.

After seeing little traffic during the summer, thousands of passengers are now passing through Eilat's new Ramon Airport every day. The number of international flights there has risen from 22 in September to 180 (45 weekly flights) in October. The winter campaign is bringing direct flights to Ramon Airport from destinations throughout Europe, which will continue until March.

Airlines such as Ryanair, Wizz Air, Finnair, Transavia Airlines, Ural Airlines, and even Lufthansa will bring 150,000 tourists to Eilat for some warm, sunny relief from the cold European winter. However, the number of weekly flights was greater last winter, averaging 55.

Optimism about the winter season in Eilat depends on tourists not abandoning Eilat for vacations in Sinai, Jordan and Jerusalem, and on Israelis flocking to conferences held in the city, despite threats to cancel them when Sde Dov Airport was closed down.

This is the first year in which all of the international flights to Eilat will land at Ramot Airport, which opened early this year, instead of Ovda Airport, as in previous winters. The foreign airlines were given a monetary incentive in order to bring them to Ramon Airport. Airlines landing at Ramon Airport are exempt from airport fees, and receive a €60 per-passenger subsidy, regardless of the price paid for the ticket, even if the passenger merely lands in Israel and continues on to the neighboring countries.

In addition, an airline that operates at least 14 weekly flights and two more weekly flights than in the preceding season will receive an enlarged grant of €66. Wizz Air met this criterion. Both Wizz Air and Ryanair operate 16 weekly flights, but Ryanair will not get the bonus, because it reduced the frequency of its flights to Ramon Airport from 26 to 16 weekly flights.

Russian airlines are also prominent in Ramon Airport's flight schedule. Pobeda Airlines will operate four weekly flights from Moscow, and will be joined by another airline. 10 flights a week from Moscow will land at Ramon Airport. Taking into account that 165,000 passengers arrived on direct flights to Ramon Airport last winter, the grants paid by the state amounted to €9.8 million. The Ministry of Tourism calls this campaign "a national project that is putting Eilat on the global tourism map." The question is whether the investment is worthwhile.

"Very low-paying tourists"

Eilat is a very typical summer city in the sense of vacation seasons. A large proportion of the city's 60,000 residents make their living from tourism. When the winter season begins, Eilat goes hungry. The campaign to encourage tourism in the city by means of a monetary incentive from the Ministry of Tourism began three years ago, coupled with campaigns in the European cities.

Dan Eilat general manager and Eilat Hotel Association chairperson Lior Mucznik describes the tourists coming from Europe on cheap flights as "very low-paying tourists," most of whom are not coming on family vacations. Speaking to "Globes," he tried to answer the question of whether the campaign was effective.

The airlines receive a grant, and the passengers continue on to vacations in the neighboring countries because of the high prices in Eilat. What's going on?

Mucznik: "We checked it out, and found that only 13-15% go immediately to Egypt or Jordan. The others remain in Israel for at least one night. It can also be a combined trip to Eilat, the Dead Sea, and Jerusalem. Most of them don't stay at hotels; they find cheap accommodation. Were all of the 165,000 tourists to stay in hotels, we would have no available rooms at all, but they are generating traffic that is like day and night in comparison to what was happening before the campaign."

"They came in their masses, but not on flights"

Eilat made quite a few headlines in the first half of 2019 in the struggle against the closing down of Sde Dov Airport, which was described as the "main artery connecting Eilat to central Israel." The struggle failed; Sde Dov closed down on July 1, joining Eilat Airport, which closed down earlier.

How much damage was caused to tourism in Eilat as a result? There are 10,000 hotel rooms in Eilat. "2.5 million people visit Eilat each year, 90% of them Israelis," Mucznik says. "The flights now taking off from Ben Gurion Airport have reduced the number of people flying, but not the number of vacationers. The July-August period this year was one of the best in the past decade in room occupancy, but we felt it on the roads, with a shortage of parking and traffic jams. People came in their masses, but not on flights."

The conferences and the tourists coming from overseas are keeping hotel prices high even in winter. One night on a weekend can easily cost NIS 1,000 for a couple. This is disproportionate in comparison with overseas vacation prices during this season.

That's inaccurate. There's a range of prices from $50 to $400 a night. In the Dan Hotel, we spend NIS 250,000 every day just on opening the door. If I charge NIS 1,000 a night for 250 rooms, I don't make a profit. Hoteliers' regular expenses are increasing. We're subject to regulation, and supervision of kosher food and municipal property taxes are expensive. Not everyone has to stay in a five-star hotel."

The foreign airlines are not the only ones filling the schedule of flights to Eilat; Israel airlines will also continue the same flight schedule that they had during the summer, according to Arkia International CEO Oz Berlowitz. "Some weeks, we'll even beef up the flight schedule," he says. "In November and December, we are getting ready for large conferences. There is demand, and we'll offer seats accordingly."

Despite the demand, Berlowitz says that flight and vacation prices in Eilat are much cheaper in this season than in the summer, given the bargains in cooperation with the hotel chains. "Winter prices in Eilat are in line with those of hotels in Aqaba, which attracted tens of thousands of Israelis during the summer and the Sukkot holiday," Berlowitz says, and also mentions the closing down of Sde Dov in less dramatic fashion than was used at the time. "Half of our passengers came from Ben Gurion Airport in any case, because the prices there are cheaper, the flight capacity is greater, and the airplanes used are larger. There was shock at the beginning, and we saw this in the numbers, but people are starting to get used to the idea."

Not just low-cost

A Lufthansa flight from Frankfurt landed at Ramon Airport on Sunday - the first flight by a major airline in the winter campaign. Lufthansa stands out among the low-cost airlines filling the flight schedule. The company reduced the frequency of its flights from two to one a week this year, but its focus will not be confined to Eilat. Among other things, it is offering flights from Ramon Airport, including a stop in Germany, for $655 to Bangkok and for $685 to Hong Kong.

Lufthansa Group Israel general manager Ofer Kisch says, "We're counting on Israeli passengers preferring to pay less for flying from Ramon Airport. The demand will be an indicator for next year. We may add another flight, and also begin flights from Munich."

How big a consideration is the Ministry of Tourism's subsidy in beginning new routes?

Kisch: "It's something that gives our people in Frankfurt confidence, but it's a catalyzer and nothing more. The purpose is to fly profitable routes."

What will happen if the next minister of tourism stops paying subsidies to the airlines? Mucznik is convinced that the airlines will stop flying to Ramon Airport. "We'll go from 45-50 to 6-8 weekly flights. It will be a lethal blow to Eilat," he warns.

Published by Globes, Israel business news - en.globes.co.il - on October 29, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019

Eilat's Ramon airport / Photo: IAA Spokesperson
Eilat's Ramon airport / Photo: IAA Spokesperson
Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018