The oil rich Saudi Arabian kingdom announced that it aims to utilise its geographical location as the basis to form its new airline – Riyadh Air.
Saudi Arabia’s Crown Prince Mohammed bin Salman formally announced the airline on Sunday, with industry veteran Tony Douglas, who previously sat in the top position at Etihad Airways for five years, joining as CEO and His Excellency Yasir Al-Rumayya will join as chairman.
The announcement came on the same day that Saudi Arabian Oil Co., known as Aramco, reported an annual profit of AU$241 billion, the largest ever recorded by an energy firm. Aramco is also owned by the Saudi Arabian government and, with this extra cash, Prince Mohammed will have more financial flexibility with the new airline and a better chance at turning Saudi Arabia into a business and tourism centre – a position currently held by its smaller neighbour, the United Arab Emirates.
The airline said it’s looking to compete with a handful of other Middle Eastern carriers, which includes Emirates, that attract a wider array of business travellers and tourists.
Where will Riyadh Air fly?
Based out of Riyadh, the capital of Saudi Arabia, the airline said it will fly to over 100 destinations across Asia, Africa, and Europe by 2030.
It’s not been confirmed yet whether Riyadh Air will fly to North America, South America, Australia, New Zealand or any Pacific Island nation. Travel Weekly awaits confirmation from the new airline.
Who owns Riyadh Air?
The airline is wholly owned by Saudi Arabia’s wealth fund, the Public Investment Fund (PIF). The fund currently has over AU$900b in assets and the new airline is a way for the kingdom to diversify its economy, which heavily relies on oil.
Riyadh Air said the establishment of the airline “will enable a more financially resilient aviation ecosystem.” This comes as many countries worldwide look to divest from oil and fossil fuels.
Which aircraft will Riyadh Air use?
Riyadh Air currently plans on using a combination of Airbus A320, Boeing 737, and Airbus A350 aircraft. The airline’s website currently says it is looking for pilots for new Boeing 787 Dreamliners and CNBC reported that Saudi Arabia was in negotiations with Airbus to order almost 40 A350 jets from Airbus.
A potential Boeing order by the airline has been valued at about AU$52.5b, according to sources familiar with the deal.
Overall, the airline has been expected to involve as many as 100 airplanes or more, The Wall Street Journal reported.
How much will the airline make?
Riyadh Air expects to bring in $20b to Saudi Arabia’s non-oil GDP growth and create more than 200,000 direct and indirect jobs.
Riyadh Air will also serve as a catalyst for the Saudi National Transport and Logistics Strategy and the National Tourism Strategy by increasing air transport options, raising cargo capacity and, in turn, growing international passenger traffic.
The Saudi Arabian government is also establishing the airline to establish itself more in the tourism and travel space and divest from its economical reliance on oil.
