Report: American Airlines Cut Philly-to-Israel Route to Boost Ties to Arab Airlines

The airline says the route hasn't been profitable.



When American Airlines announced that it was eliminating direct flights from Philadelphia to Tel Aviv, the company blamed the economics. In fact, American Airlines claims to have lost $20 million on the route in just the past year.

But the Israeli newspaper Haaretz is reporting that American Airlines actually stopped the service to boost its ties with Arab airlines through its Oneworld alliance — which includes Arab carriers like Royal Jordanian and Qatar Airways.

Haaretz quotes an unnamed source saying: “Profitability wasn’t a problem. The past year hasn’t been easy for the airline industry in general, but that’s far from saying that the route wasn’t profitable. No one would have operated a money-losing route for so many years.” The route started in 2009 under US Airways, which merged with American in late 2013.

American Airlines Spokesperson Casey Norton flatly denies the allegation.

“The route was cancelled solely because of financial performance,” said Norton. “It hasn’t turned a profit since it started in 2009.”

Some might point to the fact that the Philly-to-Israel route was cancelled even though flights were generally full. But Norton says that’s not a good indicator of profitability because it doesn’t take into account low ticket prices or the profit margins — or yield — the company gets from each customer.

The news comes as American Airlines and other carriers from the United States are sparring with Arabian airlines like Etihad Airways and Qatar Airways over government handouts.

The final Philly-to-Israel direct flight will be in January.