Saudi airline plans to buy 50 new aircraft

Flag carrier Saudia expects to purchase wide and narrow-body aircraft by end 2014 - official
Saudi airline plans to buy 50 new aircraft
By Staff writer
Thu 06 Feb 2014 02:24 PM

Saudi Arabian Airlines (Saudia) intends to purchase 50 new aircraft this year as it looks to expand its global reach, an official at the airline has revealed.

The Saudi national carrier is being upgraded as part of its privatisation process and plans to expand its fleet to meet pent-up demand in the kingdom.

Abdul Rahman Altayeb, vice president for maintenance, said the airline was in talks with plane makers Boeing and Airbus to buy new jets before the end of the year.

"We have a requirement of about 50 planes and are in talks with manufacturers about this," he said.

"We will have to decide on this before the end of the year."

Altayeb said the order would be a mix of wide-body and narrow-body planes. The company was particularly interested in Boeing's new wide-body 777X and the Airbus A380 superjumbo.

On narrow-body planes, both the Airbus A320neo and the Boeing 737 MAX were being considered, he said.

Saudia also announced on Wednesday it was planning an initial public offer [IPO] of shares in its cargo unit this year and an IPO for its maintenance business in 2015.

The cargo unit would be the second of six units - the others are catering, ground services, maintenance, airlines and flight academy - to pursue a stock market listing following Saudia's decision in 2006 to privatise them.

The first of the units to be sold publicly, Saudi Airlines Catering Co, raised $347m with an IPO of 30 percent of its shares in 2012. Its shares rose 81.4 percent last year.

"The catering has already been done. So the next one this year would be cargo and that will be followed by the maintenance unit in 2015," Altayeb said. He did not specify exactly when the cargo unit would be listed.

"The maintenance IPO cannot be expected before June 2015. We will look to sell about 30 percent of this unit."

Saudi Arabia opened its domestic aviation market to competition in 2012 as part of reforms aimed at improving service levels and accessibility, making way for two new domestic airlines. 

Qatar Airways is expected to launch domestic operations in the kingdom this year with its subsidiary Al Maha Airways, followed by privately owned Saudi Gulf Airlines.

For all the latest transport news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Subscribe to our Newsletter

Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.