Government preparing new tender for Eilat Port

The Israeli government is preparing to spread a new tender to operate the Eilat port. Finance and Transport ministries conclude that there is no reason to expand the privilege granted to Eilat Port Company, owned by Nakash Brothers, who acquired it in 2013, for a period that is scheduled to end within two years.

Sources in the auto industry believe that business entities in the Gulf will show interest in a future tender, given the port’s strategic location.

Change after war

In 2012, the government decided to privatize Eilaat Port, and after a year, the process was transferred to Eilaat Port Company, headed by Nakash Brothers, who bought the 15 -year operating privilege with an additional 10 -year option. The concession has been bought at a very low price of 120 million NIS, when taking into account the massive profits offered since then.

The state plan was for the port to deal with containers as well, but this was never implemented, as the port specializes in unloading cars – the most profitable field in the shipping industry.

Until the war began, 50 % of imported cars were emptied to Israel there. In addition, the EAPC pipeline to transport crude oil as well as fertilizer and mineral exports through the port. According to the data revealed in the discussions of the Knesateet Economic Committee, the owners of the port distributed profits of 162 million NIS in the four years before the war.

The war and Houthi attacks on the Red Sea stopped closing the ships in the Eilat port, to the point that it was almost completely closed. Thus, in 2023, the port’s revenues amounted to 212 million New while it was in 2024, with the closure of the commercial road across the Red Sea, amounting to only 42 million, a decrease of 80 %.

Meanwhile, the port has been provided with assistance since the beginning of the war, as part of the business plan for the entire economy and assistance to companies in tourism -based cities. He also received the postponement of payments from the state and the state guarantee for the loan. In addition, last June, the government voted on a specific plan to help in the Eilat port, with the port that was abandoned up to 15 million NIS, conditional on paying 3 million NIS in user fees, which has not yet paid the port to the state since the outbreak of the war.

A new tender for the port?

The Ministry of Finance and the Ministry of Transport were skeptical of the Eilaat Port request for compensation, due to the record that their owners have recorded since they bought. Also, according to government sources, the port did not make the expected investments. Meanwhile, the port also clashed with Histadrut, which represents its employees, and they approached government ministries last April with the owners not to give the option to extend the contract.

Histadrut then claimed that the conditions necessary for the appropriateness of the port had stopped its existence by not meeting the minimum workforce standards and neglecting the infrastructure of the port, and that some of the port’s cranes were not usable, while there are deficiencies in compliance with environmental standards and charging regulations. The port was sharply attacked in a speech in response and denied the claims.

This month, the port threatened to close its doors after seizing its accounts after the Eilaat municipality’s request to pay taxes, which total 10 million NIS. The threat was rested by the organizers.

However, by the end of the year, the Minister of Transport and the Minister of Finance is supposed to decide whether the concession will be extended and includes the period of the option in it. The ministers have not yet officially decided and signed the documents, but “Globes” learned that the Ministry of Transport is already working on preparing a new tender to operate the port in order to operate it under various ownership within two years of the day.

“The possibility of the wilderness”

Sources in the auto industry believe that it will be a long time before the movement of marine ships intended for vehicle transport (RO-RO) at the Red Sea resumption, due to the constant threat of Houthi, which has not been found a military solution. At the present time, most vehicles that reach Israel from East Asia make a long entrance across the head of good hope in Africa and from there to European ports.

In addition, most international freight companies to transport vehicles avoid sailing directly to Israel, so most European ports vehicles are transported to the two ports in Haifa Bay and ASHDOD.

This process extends the time that new vehicles take from East Asia to reach Israel for about two weeks and increase the cost of shipping by thousands of dollars per vehicle compared to the direct path to Eilaat across the Red Sea. However, this operation has created “actions” for Israeli ports, especially Haifa Port and Haifa Bay Port, which last year increased greatly from the size of discharge and vehicle storage.

Recently, many importers stated that they have heard estimates from Eilaat port about the resumption of charging vehicles to Eilaat across the Red Sea. However, such estimates have been heard in the past and were not achieved due to the continuation of the war. Expectations of the return of vehicle transport ships to the Suez Canal did not happen either.

However, sources in the auto industry estimate that international factors, including major commercial entities from the Gulf countries, are expected to show active interest in participating in the future tender to operate the port, because of its strategic location and expected changes in the balance of power in the Middle East. According to the sources, “The possibility of a future ground bridge, which will exceed the Suez Canal via the Earth railway from Eilaat to the Mediterranean ports, is still a strategic target, which may significantly increase the importance of the southern port in the future.”

There was no response from the Eilat port.

It was published by Globes, Israel Business News – En.globes.co.il – on July 27, 2025.

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