RIYADH, Saudi Arabia Caasimada Online) – Saudi Arabia formally announced the creation of a new national airline, Riyadh Air, on Sunday with the aim of turning the capital city of Riyadh into a global aviation hub to rival regional giants such as Dubai and Doha.
The announcement is part of the ambitious “Vision 2030” reform agenda of Crown Prince Mohammed bin Salman, which aims to more than triple the annual traffic of the country’s aviation sector to 330 million passengers by the end of the decade.
According to the official Saudi Press Agency (SPA), Riyadh Air “aims to launch flights to more than 100 destinations around the world by 2030.”
The airline is expected to operate a fleet of advanced aircraft, but the SPA did not specify the size of the fleet or its source.
However, The Wall Street Journal reported that the Public Investment Fund (PIF), the sovereign wealth fund that will own the airline, was “close to a deal” with Boeing for an aircraft order “valued at $35 billion.”
The creation of Riyadh Air is just one part of a larger plan to consolidate Saudi Arabia’s position as an international hub for aviation and a global logistics center.
Saudi Arabian authorities announced in November 2022 their intention to construct a new airport in Riyadh spanning an extensive area of 57 square kilometers (22 square miles).
This proposed airport is slated to accommodate up to 120 million travelers each year by 2030 and an impressive 185 million passengers by 2050.
The current capacity of the existing Riyadh airport stands at roughly 35 million passengers, making this planned expansion a significant development for the region.
Industry veteran Tony Douglas, former head of Abu Dhabi-based Etihad Airways, has been appointed CEO of Riyadh Air, according to the SPA.
This announcement marks Saudi Arabia’s latest move to position Riyadh as a rival to business hub Dubai, in terms of tourism, investment, and infrastructure.
Industry analysts have raised questions about whether Saudi Arabia‘s ambitious aviation goals are feasible, with some describing the regional market as already “saturated.”
However, Saudi officials are optimistic that the country’s population of around 35 million will give national carriers a significant advantage over competitors such as Emirates and Qatar Airways.
“There is sizable outbound traffic out of the kingdom as well as sizable domestic traffic,” said Khalil Lamrabet, former CEO of the Saudi Air Connectivity Program, to AFP last November.
“The reliance on transfer (flights) will not be as high as the other hubs in the region.”
According to SPA, the creation of Riyadh Air is expected to add $20 billion to Saudi Arabia’s non-oil GDP growth and create more than 200,000 jobs both directly and indirectly.
With the creation of Riyadh Air, industry experts anticipate a more intense competition for air travel passengers in the region.
The new airline will be pitted against established giants in the industry such as Emirates, Qatar Airways, and Turkish Airlines, as the travel sector recovers from the setbacks caused by the pandemic.
Riyadh Air’s potential impact on the travel industry is yet to be seen. However, Saudi Arabia’s efforts to diversify its economy and wean itself off oil have resulted in significant investments in various sectors, including tourism and hospitality.
The creation of Riyadh Air is just one example of the country’s push to develop its aviation sector and position itself as a global aviation hub.