Israel’s national airline, El Al, is facing a significant fine of NIS 121 million (approximately $39 million USD) from the Israel Competition Authority. The authority alleges that the airline exploited its dominant market position during the Gaza war, charging “excessive and unfair” fares between October 7, 2023, and May 2024. This period saw many foreign carriers suspend flights to Israel, leaving El Al with a near monopoly on air travel.
The Israel Competition Authority‘s investigation concluded that El Al effectively monopolized air travel to and from Israel for approximately seven months following the outbreak of the war. During this time, many international airlines ceased operations to the country due to security concerns. This allowed El Al to significantly increase its market share, which reportedly rose from around 20% before the conflict to over 70% within days and remained above 50% for the initial months.
The authority found no legitimate justification for the fare increases, which averaged about 16% for economy and premium classes, with some routes seeing hikes of up to 31%. These increases are deemed “excessive and unfair” given the lack of competition and heightened demand.
El Al has strongly rejected the price-gouging allegations. The airline argues that the reported 16% average increase in fares does not constitute excessive pricing and plans to present its full case during the upcoming hearing. The company noted that it recorded record revenues of $3.4 billion in 2024, with a net profit of $545 million, largely attributed to its control over routes to North America where it held a 97.5% market share with flights reaching 96% occupancy.
The proposed fine is the maximum allowed by law and will go to the state treasury if upheld. However, the decision is not final and is subject to a formal hearing where El Al can present its arguments. The authority’s fining powers, while expanded, are still considered by some to be insufficient as a deterrent compared to the scale of profits generated by large companies like El Al. For context, El Al’s net profit during the period of the war’s continuation (Q4 2023 through Q3 2025) totaled $934 million, making the proposed fine approximately 4% of that profit.
This investigation began in early 2024 following sharp increases in airfares on routes to the United States and the Far East. The authority had previously warned that it would act against any company exploiting the war to inflate prices. The proposed fine comes as El Al faces scrutiny over its pricing strategies during a period of national crisis.