The Ministry of Transport has not yet selected a second designated Israeli carrier for Russian routes, even though passenger numbers are set to increase from September 19, when the cancellation of visa requirements for travel to and from Russia goes into effect. There are fears that there could be a shortage of seats on a route considered one of the most potentially lucrative to the local tourism industry.
The cancellation of the visa requirement will mean a saving of $120 per passenger - 5% of the cost of an organized tour to Russia and 20% of the air fare, but also and perhaps most importantly, it will save a lot of the bureaucracy that obtaining a visa entailed. The revoking of the visa requirement will reportedly cause a 20% increase in the number of Israelis wishing to travel to Russia, with Moscow and St. Petersburg the usual choice of destination, and a marked 50% increase in the number of Russian tourists wishing to visit Israel
According to Ophir Tours CEO Yehuda Zafrani, although no shortage in seats is likely in the coming months, there will undoubtedly be an acute shortage from January 2009 onwards, if a second designated carrier is not announced soon.
The bilateral agreement between Israel and Russia provides for the operation of four regular carriers. At present El Al Israel Airlines (TASE: ELAL) is the only Israeli airline flying to Russia, with two daily flights to Moscow and St. Petersburgs. Israir Airlines and Tourism Ltd. and Arkia Airlines Ltd. have said they would be interested in receiving designated carrier status on this route, which is believed to have considerable potential, but that they are not ready to begin operating regular flights since no decision has yet been made.
Published by Globes [online], Israel business news - www.globes-online.com - on September 4, 2008
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