El Al Israel Airlines Ltd. (TASE: ELAL) was scheduled to make history by launching its official direct flights from Tel Aviv to Tokyo on March 11, 2020, but the coronavirus outbreak has disrupted its plans.
Japan is one of the world's premium destinations, and the Olympic Games scheduled to take place there this summer has made it especially popular. Coronavirus, however, is wreaking havoc on civil aviation and forcing a change in plans.
Following the spread of the virus, with a report that South Korean tourists who visited Israel were infected, El Al will have to reconsider its new route. It is likely that in the next few days, the airline will announce the postponement of its first direct flight to Japan.
Starting tomorrow, Japan and Taiwan will be added to the list of countries from which the Ministry of Health is banning the entry of foreigners to Israel. Israeli residents who spent time in these countries will be required to enter isolation upon their return to Israel. The list currently includes China, Hong Kong, Singapore, and Thailand. The Ministry of Tourism has informed agents that they must cancel tours in Israel by residents of Japan and other countries.
As a result, managers of El Al, who were supposed to have inaugurated the new route, and managers of large travel agencies, will have to spend 14 days in home isolation upon their return, not to mention the steep drop expected in passenger traffic: Israelis out of anxiety and Japanese whose entry into Israel will be banned.
This problem comes at a difficult time for El Al. The company already reported that it expected a drop in its revenue in the quarter as a result of the coronavirus, and Minister of Transport Bezalel Smotrich quickly said that government compensation for the airline should be considered. Like other airlines affected by the virus, however, El Al has also benefited from the drop in oil prices. The company is also offering free cancellations of flights to Europe for the next year.
Meanwhile, it is likely that El Al will announce the suspension of flights to Bangkok, because Thailand is already on the Ministry of Health's list. Routes to Beijing and Hong Kong have already been suspended. It now appears that the celebrative invitation to the event for launching the route to Tokyo "in the presence of the Japanese ambassador to Israel" will have to wait.
Published by Globes, Israel business news - en.globes.co.il - on February 23, 2020
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