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Saudi Arabia plans to base new airline in Riyadh; to tap tourist traffic

Just under a year ago, Saudi Arabia announced its plans to launch a new national airline. Rather than replacing the existing flag carrier Saudia, the country now plans instead for the new airline to operate alongside its main carrier. As such, it has devised a two-hub strategy, which will see the new carrier based in Riyadh.

The story concerning Saudi Arabia’s proposed second national airline began in June last year, when the country announced its plans to set up such a carrier. It intends to do so as part of an initiative known as Vision 2030, a project aimed at reducing Saudia Arabia’s dependence on oil by generating income through increased tourism.

Exemplifying its ambitions in this sector, the country has set a goal of reaching 100 million visitors a year within the next decade. While Saudia will likely play a significant role in enabling this, the carrier has made losses in recent years.

As such, Saudi Arabia’s plans to form a second national airline will be an important part of achieving its ambitious tourism-related targets.

Also tied to the Vision 2030 project, according to Gulf News, is the intention to transform Saudi Arabia into a Middle Eastern aviation hub.

The Kingdom plans to handle 330 million passengers a year, compared to the 100 million it has capacity for now. A key part of achieving this goal will be implementing a two-hub strategy. This will allow Saudi Arabia to spread its capacity across two airports, rather than concentrating passengers through one facility. Specifically, Saudia will be based in Jeddah, while the new carrier will operate out of Riyadh. The Head of Strategy at the General Authority for Civil Aviation, Mohammed Alkhuraisi, explained, “Jeddah is the gateway to the two holy mosques and the Red Sea line, while Riyadh is the business hub, and it requires different products.”

A key part of establishing an airline is forming its brand identity, with the disclosure of its name playing an important role in this process. However, for now, this step has not been openly taken by the Public Investment Fund, the group that is most heavily involved in setting up the carrier. In this regard, Alkhuraisi stated, “The plans of the new airline in terms of operationalization, incorporating the company, naming, and launch date are all within PIF jurisdiction. As far as we know, the plans are moving, but the details are with PIF.” (Source: Simple Flying)


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