The fall in oil prices over the past few years and intense competition from low-cost carriers have pushed down air fares worldwide. In response airlines have been compelled to find new services and charges to boost ticket prices, increase revenue and stem the erosion in their profits.
El Al Israel Airlines Ltd. (TASE: ELAL) yesterday introduced one such fee, which has always been charged by low-cost carriers and is now becoming popular with some of the world's major airlines. There is now a $10 surcharge for passengers wishing to select and reserve a particular seat ahead of time - otherwise they will be allocated seating randomly by the airline.
The new charge in no way effects the fee of $25-100 that has always been imposed for those wanting a preferred seat with extra leg room or near an exit. If a passenger cancels an airline ticket after paying the new charge for a selected seat, the money will not be refunded.
El Al does not guarantee that families or even couples can sit together on busy flights so the new fee may be necessary for people who want to travel together or are fussy about what part of the plane they like to sit in, or whether they prefer a window or aisle seat etc. Generally speaking unreserved seats are in the back half of the plane.
El Al is by no means alone in introducing the seat reservation charge. British Airways can charge $35-40 for reserving seats and Delta charges $40. Swiss charges $29, Air France charges $20, Iberia charges $19-22 and Lufthansa and Austrian Airlines each charge $11. From tomorrow, Air Europe is also introducing a seat reservation charge of $25.
Published by Globes [online], Israel business news - www.globes-online.com - on November 2, 2016
© Copyright of Globes Publisher Itonut (1983) Ltd. 2016