Saudi Arabian authorities have given the green light to a consortium led by the UAE's Air Arabia Group to launch a low-cost airline in the kingdom.
The new airline is expected to serve 81 destinations – 24 domestic and 57 international – by 2030, the Sharjah-based carrier said in a statement on Monday.
The group received an air operator certificate from the General Authority of Civil Aviation (Gaca) to launch flights from King Fahd International Airport in Dammam.
Air Arabia is joined in the consortium by Nesma Group and KUN Holding. The trio won the bid to establish and operate the new airline in July 2025.
The unnamed carrier is expected to boost tourism in the Eastern Province and create more than 2,400 direct jobs. By 2030, it aims to operate 45 aircraft and carry about 10 million passengers annually.
“The launch … will contribute to enhancing competition and improving performance in the air transport market, while supporting trade and tourism in the Eastern Province and creating new local employment opportunities,” said Sulaiman Almuhaimedi, Gaca's executive vice president of aviation safety and environmental sustainability.
The licence was granted after the group ensured “the highest levels of safety and operational compliance” and mirrors Gaca's role in creating “an attractive investment environment”, he added.
Air travel in the Middle East has been affected by the continuing US-Iran war. Airspaces, especially in the Gulf, were shut down in the early weeks of the conflict, which began on February 2. Services gradually returned as carriers such as the UAE's Emirates and Etihad Airways, Saudia and Qatar Airways resumed flights following safety assessments.
Some other international carriers have gradually resumed services, while others have extended their suspension and are monitoring the situation.
Still, the aviation industry in the Middle East remains resilient as analysts predict a strong postwar rebound similar to that which followed the Covid-19 pandemic.
In Saudi Arabia, the Arab world's biggest economy, the government continues to invest in aviation. Saudi Arabia is prioritising fleet expansion, airport construction and new facilities, as well as more robust air connectivity, in addition to promoting its tourism sector as part of the Vision 2030 economic diversification programme. The kingdom also launched Riyadh Air in 2023 to support its aviation and tourism goals.
Elsewhere in the Gulf, Dubai Airports boss Paul Griffiths last week said the emirate's aviation sector was experiencing a “trampoline bounce” effect, demonstrated by recent growth.
Also last week, Wizz Air announced it would restore eight routes connecting Abu Dhabi and Dubai with European cities from October, bringing 32 weekly services back to the UAE.
Air Arabia, which began operations in 2003, operates a fleet of more than 90 Airbus A320 and A321 aircraft. The airline has an order for 120 Airbus aircraft, with deliveries having begun in 2025. It operates from six main hubs across Sharjah, Ras Al Khaimah, Casablanca, Alexandria, Abu Dhabi and Karachi.
