Saudi reform plan to transform flagship carrier into money-maker
The Saudi plan for economic transformation will help turn the country’s flagship airline into a money-maker that people will want to invest in, says a top executive at the carrier’s parent company.
Speaking on Monday at the Arabian Travel Market trade show in Dubai, Saleh Al Jasser said that changes planned for Saudia Group, the holding company of Saudia Airlines, are “fully aligned” with the big-picture 2030 reform plan.
The group’s plans include the launch of a budget airline and a business class airline.
“The main airline [Saudia], the restructuring programme will help it turn the company to profitability and make it ready for listing,” said Mr Al Jasser, who is the director general of the holding company.
“We believe that 2020 is the time when the main airline will become profitable. It’s too early to say what stake [we will list], but usually we listed 30 per cent.”
Saudia Group has previously listed some of its subsidiaries including its ground services and catering companies, and cargo business.
“Saudia will benefit definitely from the different initiatives of the national transformation,” said Mr Al Jasser, adding that these initiatives will boost tourism in the country, and that will certainly help his airline.
Saudia Group’s diversification plan includes the launch of a low-cost airline called Flyadeal. The budget carrier is to be based in Jeddah with a launch set for 2017.
With a separate chief executive who is yet to be appointed, Flyadeal will fly to Saudi cities and other destinations in the region.
Flyadeal is looking to have 25 to 50 aircraft by 2020. Its fleet will be a unified type of narrow body aircraft, said Mr Al Jasser. The company is deciding between an Airbus 320 or a Boeing 737 fleet.
Separately, the group will be setting up a business jet arm with three 48-seat Airbus A319 aircraft. “It is all business class,” said Mr Al Jasser. “It will start between Jeddah and Riyadh and it will depart and arrive at the private aviation terminals.”
Saudia Airlines plans to grow its passenger numbers to 45 million by 2020, up from 30 million in 2015.
This year it is adding four destinations – the Maldives, which started last month, Ankara, Algiers and Munich. Across the group, it plans to have 200 aircraft by 2020, up from the 120 that it has today.
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Published: April 25, 2016 04:00 AM