WASHINGTON (Jul. 13)
Israel and the United States were reported to be approaching a new civil aviation agreement with a compromise centering on the extent of “flexibility” in air fares U.S. companies could charge and the additional number of American cities to which Israel’s El Al airline can operate.
American sources said that the two delegations are “assessing” their positions during the current hiatus in their talks but they are “close enough to an agreement satisfactory to both sides” that a decision may soon be announced. The negotiations opened last month at the State Department.
According to these sources, the U.S. is prepared to provide “several” additional cities which El Al could use in return for any passenger rates that U.S. carriers may wish to charge on flights to and from Israel.
“We want to squeeze the fat out of the business and give the consumer the benefit of cheaper air travel,” an American negotiator told the Jewish Telegraphic Agency with regard to the U.S. position on fares. The U.S., he said, would like American airlines to have “the ability to set fares they believe to be competitive.” The U.S., he added, is prepared to provide El Al with landing rights in “more than two but less than the 12 cities” in which El Al seeks landing rights. Israel allows charter flights from only the three West Coast states. The U.S. wants charters to include all states.
SEEKING ADDITIONAL LANDING RIGHTS
In its outlook for increasing El Al landings in America, Israel is seeking to add Miami, Los Angeles, Chicago and Boston as major gateways and landing rights in seven other cities. At present, El Al can land only in New York.
On the “flexibility” in fares, Israel was represented as fearing that the American airlines may provide a “loss leader type of business that would imperil El Al’s capability to compete effectively” since it is a small airline unable to match the resources of the giant U.S. carriers and would be ultimately frozen out of the passenger market. Israel, therefore, seeks an agreement of minimal fares that would enable El Al to compete with U.S. airlines on passenger ticket cost.