The management of El Al, Israel’s de facto national airline, says it reached an agreement overnight that will send home – for good – about one-third of its administrative and maintenance workers, who together make up close to 60% of the company’s workforce. The onetime state-owned airline was deep in the red even before the coronavirus pandemic and has furloughed well over 80% of its employees since March. It grounded its entire fleet, including cargo aircraft, until the end of the month. On Monday, the state agreed to a bailout in the form of a $250 million guaranteed loan conditioned on firings and the floating of new stock shares. The streamlining agreed to overnight between Tuesday and Wednesday will be encouraged by early retirement incentives and attractive severance packages expected to save the company close to $90 million per year. If this proves insufficient or the firm defaults on the guaranteed loan, the state could find itself a majority owner of El Al, considered one of the world’s least profitable major airlines primarily owing to the fact that it does not fly on Friday evenings or Saturdays. This policy is aimed at attracting customers from the country’s relatively large population of religious Jews, who prefer to avoid patronizing companies that operate on the Sabbath.
Wake up to the Trusted Mideast News source Mideast Daily News Email