Lufthansa AG (XETRA: LHA) unit Lufthansa Technik will help Israir Airlines and Tourism Ltd. establish center for routine plane maintenance. When completed, Israir will stop buying plane maintenance services from El Al Israel Airlines Ltd. (TASE: ELAL).
Under the recently signed cooperation agreement, Lufthansa Technik will train Israir technical teams, after which they will maintain the carrier's two Airbus A320s (it will take delivery of a third plane later this year). Israir will continue to carry out maintenance of its own ATR 72 turboprop planes.
Aviation sources say that Israir decided to work with Lufthansa Technik, after disputes with El Al. The sources expressed surprise that the government has allowed a foreign company to grab work from an Israeli company. They compared Israir's maintenance center to a kiosk outside a supermarket. El Al's Bedek maintenance division has 1,300 employees, mostly Israel Air Force veterans.
El Al said in response, "El Al's Bedek Division maintains planes for El Al and other Israeli airlines. It also provides many services for foreign airlines."
Published by Globes [online], Israel business news - www.globes-online.com - on February 27, 2014
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