Israeli-owned Blue Bird fills vacuum in Tel Aviv flights

Blue Bird aircraft credit: Blue Bird
Blue Bird aircraft credit: Blue Bird

Serving 14 European destinations, the Greek-based airline has built the fifth largest market share of Ben Gurion airport passengers.

While foreign airlines were procrastinating on resuming flights to Israel, Blue Bird saw the potential and restarted its Ben Gurion airport operations in February. The Iranian attack in April also failed to deter the Greek-registered and Israeli-owned carrier, which has partly filled the vacuum left by the foreign carriers.

Blue Bird currently operates flights from Tel Aviv to 14 destinations in the Mediterranean and Europe. The company owns three Boeing 737-800 aircraft, and its main activity is flights from Tel Aviv to Greece, with routes to four different destinations in the country.

Blue Bird says that its business as usual despite the war. In fact since the war began, Blue Bird has become even more popular with Israeli travelers. Israel Airport Authority data show that in April, Blue Bird was one of the most popular airlines in Israel, with a 5.15% market share of passengers (almost 60,000). This put it up to fifth place, behind El Al, Israir, Arkia and Hungarian low cost carrier Wizz Air. In April 2023, Blue Bird carried nearly 50,000 passengers representing a 2.4% market share at Ben Gurion airport.

It is no big surprise that the Greek airline is performing so solidly in Israel. Even during previous Gaza operations, Blue Bird continued to fly regularly to Israel, while most airlines preferred to halt their flights. Last October, the company even operated rescue flights for Israelis who needed to report for reserve duty.

Blue Bird's loyalty to Israel is no coincidence. The Greek company was acquired in 2016 by the owners of tour package group Kavei Hufsha (Holiday Lines), one of the largest companies in the field of tourism in Israel, which is owned by Ami Cohen and Arnon Englender.

There are still challenges

Blue Bird is not the only airline owned by the Israeli tourism group. In January, Kavei Hufsha bought a 33% stake in Cyprus-based airline TUS, which it holds in partnership with Global Knafaim.

Kavei Hufsha stresses that Blue Bird is essentially a Greek airline with Greek staff, headquartered in Heraklion in Crete and that its Israeli ownership is not the reason that the company does major business with Israel but rather the high demand.

However, the Greek-Israeli combination is not without its complexities, and as with other foreign companies, as soon as there is a worsening of the security situation, it too faces the familiar challenges, including rising insurance premiums and aircrews who refuse to fly here. But as this is a short-haul carrier that flies to nearby destinations, in most cases crews and planes do not need to stay in Israel.

In recent weeks, there have been many complaints by groups of travelers about changes in the company's schedules. But Blue Bird insists, "The postponement of the flights was only after the Iranian attack, due to the situation, and we still continued to operate flights from Ben Gurion airport every day. There are constraints that lead to changes, and our desires do not always connect with the security reality in the State of Israel. By the way, this has applied to every Israeli and foreign airline that has been operating in Israel since last October."

Other complaints about the airline by passengers includes regarding baggage policy, where the weight allowed is unclear, so passengers discovered additional charges at the last minute. Blue Bird insists "The issue of baggage is very clear and listed in three languages (including Hebrew) on the website and in all Blue Bird sales channels. All that is required of passengers is to arrive at the airport with baggage according to the conditions of the purchased ticket."

A known phenomenon worldwide

According to Israeli aviation and tourism expert Yossi Fisher, in Israel it is less common for tourism companies to acquire airlines, while in the world this is a known phenomenon. For example, Germany's TUI, the largest tourism company in the world, owns five different airlines. Another company that operates on a similar model is Thomas Cook & Sons, which was the first major travel company in modern times, but went bankrupt in 2019. When it was operating, Thomas Cook owned Condor Airlines, the second largest company in Germany, which today operates independently.

"Once you have the ability as a company to provide airplane seats, you have the possibility to earn more and control the entire tourism chain, and bring in and take out tourists. In a country like Israel, which is considered an island state, from which it is impossible to travel by train to another country, an aviation arm together with the ability to operate in tourism allows a very big comparative advantage in the market," says Fisher. "In the case of Blue Bird and TUS, once you have companies with a European operating license that travel in the Mediterranean region, there is a tremendous advantage because the company operates on Saturdays and holidays. This meets a very serious shortfall in demand on Saturdays and holidays, which Israeli airlines do not provide and the big money is precisely during these times."

The agents aren't relevant

Today travel agents understand that customers can manage by themselves. Fisher points out that agencies no longer define themselves as agents but rather travel consultants. "Systems are simple and easy, and almost anyone can buy a plane ticket in five clicks. I believe this is one of the professions that will disappear from the world," he estimates.

Fisher adds that the airlines have cut commissions for agents, so they sell packages. "Companies sell packages and not just their own, and other agents also take seats on the flights. In Blue Bird, for example, Arkia holds part of the seats on a plane to Athens, and its rival ISSTA holds another part," says Fisher. "There are also many small agents who do not buy packages themselves, but buy ready-made packages from travel companies. This is the answer to the changing needs of the market."

ISSTA VP sales and marketing Tali Noy thinks that despite everything travel agents won't disappear any time soon. "Travel agents act both online and offline. We thought that the world of travel agents was disappearing, but in fact it only got stronger and took on a new configuration. Since Covid, the number of travel agents are small, but those that exist are much stronger, and the volume has increased among them. The average salary of an agent has risen between 30%-40%. "Ultimately, the Israeli customer wants to buy in a place where they have someone to talk to in a crisis, someone who will take care of their money, and above all they want a travel agent that knows how to adapt things for them. I see the world of agencies getting stronger, especially in segments that require specialization, such as holiday packages, cruises and sports holidays."

Published by Globes, Israel business news - - on May 30, 2024.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2024.

Blue Bird aircraft credit: Blue Bird
Blue Bird aircraft credit: Blue Bird
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