Arkia Workers Threaten Strike Over $30M Loss and Share Dilution

Arkia Israel Airlines expects to lose more than $30 million in 2026, a financial strain that has triggered a confrontation between the carrier’s workforce and its controlling owners. The dispute centers on a planned capital raise that would dilute the 22.1 percent stake held by employees through the TUT, Aviation & Tourism Workers Corporation Ltd.

Roughly 300 employees gathered outside the airline’s offices in Bnei Brak, east of Tel Aviv, on Tuesday. The demonstrators opposed recent moves by the Nakash brothers, who control more than 70 percent of the company, to inject new funds. Workers fear this financial maneuver is a precursor to a sale that will strip them of their current rights and job protections.

The protest followed a board meeting on Sunday where employees learned of the capital raise plans. Workers argue the primary goal is not to solve immediate financial issues but to make the airline more attractive to a buyer. They contend a potential purchaser would likely offer a lower price if employees retained significant influence over corporate decisions.

The Transportation and Seaport Workers’ Union sent a letter to the Nakash brothers and CEO Oz Berlowitz on Monday. The union charged that management is considering restructuring measures unilaterally, bypassing the employees who are partners in the company. The union threatened industrial action, including a labor dispute, and demanded an immediate freeze on all contested measures while expressing readiness to negotiate.

Arkia operates domestic flights and routes to major European cities, having expanded to long-haul destinations such as New York, Phuket, and Hanoi in the past year. The company, owned by Jordache Enterprises, acknowledged severe cost pressures in the industry. A company statement noted that sharp surges in jet fuel prices and rising input costs are impacting airlines globally.

In a statement, the Nakash brothers described Arkia as a strategic asset for the state and its workforce. They instructed CEO Berlowitz to present an immediate action plan and solutions to address the current challenges. The group stated it continues to weigh alternatives to ensure the carrier’s operations remain intact and its skies stay open.

Earlier this year, Arkia employees opposed a potential buyout by an ultra-Orthodox US entrepreneur who proposed halting flights on Shabbat and Jewish holidays. Those negotiations fell through, leaving the current capital raise as the next major financial step for the airline.