Zakay added that revamping the aviation sector was a “strategic” imperative that could prevent “fatal harm to an industry comprised of tens of thousands of people and hundreds of professions.”
Earlier this week, Israel’s national airline EL AL announced that it has canceled all its flights – both passenger and cargo – due to the massive loss of revenue and ongoing labor disputes.
The economic downturn due to the coronavirus pandemic has hit airlines across the globe particularly hard. A company statement released Tuesday highlighted that EL AL has hemorrhaged $140 million in the first quarter of 2020.
In addition, negotiations between representatives of Israel’s pilot union and EL AL ended without resolution, contributing to the airline being shuttered.
El Al has sought a $400 million government bailout as it negotiates a repayment scheme. Reports suggest EL AL could receive the entire sum as a loan mostly backed by a state guarantee.
A second option includes a state-guaranteed loan of $250 million and an equity offering of $150 million, also with state backing.