Saudi Arabia's Crown Prince Mohammed bin Salman has announced the creation of new national airline Riyadh Air, as the kingdom seeks to develop into a global transport and logistics hub, attract tourists and diversify its economy.
The new carrier will be wholly owned by Saudi Arabia's Public Investment Fund, which has about $620 billion in assets under management and backs strategic sectors central to the kingdom's economic diversification plans.
The sovereign wealth fund's governor Yasir Al Rumayyan will be the airline's chairman, while former Etihad Airways boss Tony Douglas has been appointed its chief executive, the PIF said on Sunday.
Saudi Arabia's second national carrier will connect the capital Riyadh to more than 100 destinations around the world by 2030, leveraging the country's strategic geographic location between Asia, Africa and Europe, the PIF said.
Riyadh Air is expected to contribute 75 billion Saudi riyals ($20 billion) to the country's non-oil gross domestic product growth and to create more than 200,000 direct and indirect jobs, according the state-news agency Saudi Press Agency.
The move is part of the kingdom's wider strategy to transform into a global transport and logistics hub and to promote itself as a tourism destination.
Saudi Arabia had earlier announced plans for a new national carrier to be based at King Khalid International Airport in Riyadh, as part of its aviation strategy and push to diversify its economy from oil.
The country's Saudi Aviation Strategy calls for tripling annual passenger traffic to 330 million by 2030, boosting the number of destinations to 250 from 99 at present and establishing a new flag carrier.
This strategy is backed by $100 billion in investments from the government and private sector.
Saudi Arabia's Crown Prince Mohammed bin Salman last November announced that a new airport will be opened in the capital Riyadh with six parallel runways and designed to accommodate up to 120 million travellers by 2030.
The new carrier will acquire "modern aircraft equipped with the latest technology", the PIF said. It did not provide details about the planned fleet size, aircraft types, manufacturers or whether the planes would be owned or leased.
Riyadh Air's chief executive, Mr Douglas, who took the reins at the Etihad Aviation Group in January 2018, stepped down from his role at the Abu Dhabi-based airline in October last year.
The British aviation executive led Etihad to a record first-half profit as demand for long-haul travel recovered with the easing of Covid-19 restrictions and air cargo revenue continued to grow.
He led the airline through a five-year restructuring programme that transformed it into a medium-sized airline as it reduced its fleet, network and workforce.
Mr Douglas previously worked at the UK Ministry of Defence, after serving as chief executive of Abu Dhabi Airports and filling an executive role at London’s Heathrow airport.
Saudi Arabia is currently home to Jeddah-based national carrier Saudia and its low cost subsidiary flyadeal.
Willie Walsh, the head of the International Air Transport Association, has previously said he sees room for the planned new national airport in Saudi Arabia among the established travel mega-hubs in the UAE and Qatar, as Middle East carriers continue to recover from the pandemic.
“Do I see scope for a hub in Saudi? Yes,” he said at a media briefing in Geneva, in December.
“There is scope for the geographic location of a new hub not in close proximity to Dubai and Doha. That is something that could work.”