El Al chief executive Gonen Usishkin has cancelled all operations indefinitely, following the announcement of a strike from the Israeli pilots’ union (ISRALPA) on Tuesday evening.
Hebrew-language newspaper Globes reports that this includes both passenger and cargo flights, and that services were ordered back to Israel mid-flight after notice went out on Wednesday.
According to ISRALPA, the strike follows a decision by El Al not to allow 30 737 pilots to transfer to flying cargo flights on 787 Dreamliners – a move it said the airline had previously agreed to.
“Since the administration of the company did not even respect the agreements that were signed with the union less than a month ago, the union had no choice but to arrive at the conclusion that the owners of the company are unable to save it from its situation,” said a spokesman.
El Al has been battered by the coronavirus downturn, losing nearly US$145 million in the first quarter of 2020.
As the airline seeks to negotiate a rescue package, however, the government has argued that the airline’s financial problems can be traced back to well before the pandemic.
Since Israeli Prime Minister Benjamin Netanyahu first instructed Ministry of Finance officials to cut a deal to save the national carrier, two deals remain on the table.
The first would see El Al issued US$400 million in state-backed loans, whilst the second would couple a US$250 million loan with a US$150 million share offering.
As the parties hash out the details, El Al said that it is in the “advanced stages” of securing one of the two packages – though it adds it needs workers and ISRALPA representatives to sign off on any deal.
“The scope of the coronavirus crisis is something we have never seen, and no airline, no matter how strong, can survive without government assistance,” said Usishkin.
