Cyprus Is Arkia's Most Profitable Route, Says CEO Oz Berlovitch
Arkia CEO Oz Berlovitch revealed that Cyprus is the airline's most profitable route due to low risk and high demand. In a recent interview, he also highlighted a doubling in business-class travel among Israelis.
Cyprus has emerged as the most profitable route for Israeli airline Arkia, offering the optimal balance between low risk and high return, according to company CEO Oz Berlovitch.
Speaking on the "Bulldog" podcast on Arutz 7, Berlovitch detailed the commercial dynamics of the carrier's network while addressing broader trends in the Israeli aviation sector.
The Economics of Regional Aviation
"Our most profitable route is Cyprus. Aviation is always a calculation of risk versus reward. This is the route with the lowest risk and the highest potential," Berlovitch stated.
When pressed on why Arkia pursues long-haul destinations like New York, Japan, and Thailand rather than exclusively scaling up its Mediterranean operations, the CEO pointed to intense market saturation. Numerous carriers operate flights between Israel and Cyprus, including Wizz Air, Arkia, Israir, El Al, TUS Airways, Blue Bird Airways, and Cyprus Airways, with Ryanair, easyJet, and multiple charter operators expected to enter or resume services.
Rising Demand for Business Class
Berlovitch also highlighted a significant behavioral shift among Israeli travelers, noting a sharp surge in demand for business-class seating over the past five years compared to the previous half-decade.
"The world has become much more pampered, passengers are much more pampered. Compared to five years ago, the number of Israelis flying business class has at least doubled," Berlovitch said.
According to the airline executive, the pricing structure heavily favors premium cabins, with business-class tickets typically priced at triple the cost of an economy fare. This economic model means that a single business-class passenger generates revenue equivalent to three economy passengers.
Asked to identify the demographic profile of business-class flyers, Berlovitch dismissed the notion of a narrow target audience, attributing the growth to rising living standards and consumer psychology.
"Living standards are rising, and people allow themselves more comfort. In the end, it is also about ego," he explained, adding that long-haul passengers who experience business class rarely downgrade to economy on future flights.