Saudi Airlines gets $1.9bn loan to buy 17 jets

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Saudi Arabian Airlines, the Gulf kingdom’s flag carrier, has signed a SR7bn ($1.87bn) loan deal to fund the acquisition of 17 new aircraft.

The agreement, with a syndicate of banks led by local lender Samba Financial Group, will form a key part of the airline’s drive to modernise its fleet and focus more on international routes.

The carrier’s director general, Khalid bin Abdullah Al Molhem, said that Saudi Arabian Airlines will require 100 new planes through to 2020 in order to meet its growth planes. Out of 90 aircraft ordered over the last six years, the airline has so far received 70.

“There is growth of traffic worldwide like a flood,” Al Molhem said. “Who is investing today? Not the Europeans, it’s the Middle East. It has faster decision-making and is buying planes more quickly.”

Al Molhem added that the airline planned to develop Jeddah into a “strong hub”, while taking advantage of Saudi Arabia’s huge domestic market.

He indicated that the carrier would be restructuring its short-haul flights amid the arrival of two new domestic airlines into the market, scheduled for later this year. “We are working with the authorities to restructure those routes with more carriers to come in,” he added.

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