Saudi Arabia’s national carrier Saudia is planning to order more aircraft, said a senior company official.
Addressing the media in Dubai on Wednesday, Khalid bin Abdullah Al Molhem, Director General of Saudia, said the company is “looking to purchase additional aircraft for the local market” which is being heavily under-served.
Saudi carrier decided to revamp its aging fleet six years ago and has ordered 90 aircraft over the period. So far it has received 70 aircraft. It didn’t add any new aircraft in its fleet for around 20 years.
“We didn’t buy new aircraft for 20 years and decided to upgrade fleet six years ago as fleet maintenance was too inexpensive and we also wanted to bring in aircraft which suit our needs. We have phased out a number of aircraft from our fleet over the last few years,” he added.
He didn’t elaborate on the number of aircrafts company is looking to buy.
On Wednesday, Kuwait Airways also signed contracts with Airbus to buy 25 planes, its first order for new aircraft in more than 20 years.
Al Molhem said Saudi Arabia’s domestic aviation market is under-served as the kingdom is facing 1.5 million passenger seats shortage annually.
He shrugged off any impact on Saudia by the two new carriers to be launched this year in the kingdom. “We’ve allocated 50 aircraft for the domestic operations where we’ve one of the world’s highest seat occupancy rate of around 94 per cent. These two new carriers will allow us to expand our international operations and serve the existing foreign routes better.”
Commenting on financing, Al Molhem said the carrier signed a loan deal of 7 billion Saudi riyals with banks and is also considering some innovative financing methods for future needs. He refused to disclose what financing methods the company is studying.
He told media that the carrier is also in the process of arranging an IPO of its ground handling unit.
Khalid bin Abdullah Al Molhem is currently in Dubai to market Saudia’s 50 years in operation.
Al Molhem also announced opening a bigger 90,000 sqft office in Dubai.
“We’ve optimistic view about the industry’s growth in the region and that’s why we are growing operations in Dubai and other parts of the world. We’ve just opened a bigger and sophisticated office in Dubai to better cater the country,” he added.