By Steven Scheer
JERUSALEM, April 16 (Reuters) - El Al Israel Airlines said on Thursday it would buy up to 12 more 787 Dreamliner aircraft from Boeing in a deal worth $1.5 billion, taking advantage of its dominance of the Israeli market during the conflicts in Gaza and Iran.
Under an amended deal with the U.S. aircraft producer, El Al said it was exercising its option to buy six more 787-9 Dreamliners, and converting an option for the purchase of four of the planes into the more advanced and efficient
787-10 models to be delivered between 2030 and 2032.
Israel's flag carrier was also granted options to purchase up to six more 787 aircraft, used on lucrative flights to the United States and Asia, for delivery between 2033 and 2035.
It said it would evaluate financing options closer to the delivery times.
"Expanding the 787 fleet allows us to increase capacity (and) improve efficiency," said chief executive Levy Halevy. "This is a key step in our strategy to build a modern, profitable and market-leading airline."
El Al currently operates 17 787s. It expects to reach 28 by the end of the decade and eventually as many as 34.
ALL AMERICAN FLEET
The airline has maintained an all-Boeing fleet since its inception in 1948, owing to Israel's close ties with the United States, but its use of ageing 767s, 747s and 777s saw it lose market share to foreign carriers operating more modern planes.
It signed a $1.25 billion deal with Boeing for an initial 15 787 aircraft in 2016. In 2024, it bought three 787-9s with an option for six more, and also signed a deal for up to 30 737 MAX short-haul aircraft, worth up to $2.5 billion.
"By choosing an all American fleet, it's a strong sign to the Trump Administration," said Mark Feldman, CEO of Ziontours.
With foreign carriers halting flights for much of the two-year Gaza conflict, and again since the war with Iran started, El Al has rebounded to hold a near monopoly on routes to and from Israel.
It earned a net $410 million in 2025 after a net $545 million in 2024 and $117 million in 2023, but while passengers unable to rely on foreign carriers are happy the airline has continued to fly, they have expressed anger at its high fares.
Feldman said that foreign carriers would eventually return and El Al needs to expand North American and Asian routes to compete.
El Al's shares were down 1.9% in afternoon trade in Tel Aviv.
(Reporting by Steven Scheer Editing by Louise Heavens, Kirsten Donovan)
