Qatari Airways in talks on Saudi airline

Qatar Airways is in talks with Saudi Arabia over launching a new airline in the kingdom, following a decision by Saudi Arabia to liberalise its aviation industry.

Qatar Airways is in talks with Saudi Arabia over launching a new airline in the kingdom, it was announced yesterday.

Following a decision by Saudi Arabia in April to liberalise its aviation industry, the Qatar Airways chief executive Akbar Al Baker has opened discussions on potential opportunities with the Saudi government, the airline said.

But, in its statement, the airline said it was looking for further liberalisation before pursuing any new project. "With a market that is underserved and keen for greater domestic air services, Mr Al Baker [believes] the kingdom represents a key growth area," the statement said.

"However, during the meeting, Mr Al Baker expressed particular concern over excessive fuel charges in the kingdom and the government's policy of controlling domestic air fares which were not in the interests of the travelling public nor airline operators. Mr Al Baker said such factors were detrimental to airlines as fuel represented a major cost of operations."

Saudi Arabia has said it intends to begin approving new airline licences in September, and Mr Al Baker said Qatar Airways was keen to invest in the Saudi domestic aviation market, but this was dependent on a fundamental rethink by the government of certain policies, "which needed to be tackled".

The Qatar Airways chief cited the current Saudi policy of capping airfares as a major problem, and blamed it for the demise of the domestic Saudi carrier Sama Airlines.

"Other airlines operating domestic flights within Saudi Arabia are facing the same problem of rising costs … these needed to be seriously addressed. Also, capping airfares will never allow any airline to operate commercially in the kingdom," the statement added.

Qatar Airways is in the middle of a rapid expansion programme.

Since the beginning of the year, it has launched services to Baku, Azerbaijan; Tbilisi, Georgia; Kigali, Rwanda; Zagreb, Croatia; Erbil and Baghdad, Iraq; and Perth, Australia.

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