Saudia inks deal to privatize aircraft maintenance firm

Saudi Arabian Airlines has a signed a major deal to privatize its aircraft maintenance company — Saudi Aerospace Engineering Industries.
Saudia is selling 30 percent of its stake to Tarabut Aircraft Maintenance Company, owned by Integrated Transport Company, under the agreement.
"This strategic partnership will have great benefits for the Kingdom as well as investors," said Khaled Al-Molhem, director general of Saudia.
He and Prince Sultan bin Muhammad bin Saud Al-Kabir, chairman of Integrated Transport Co., signed the deal in the presence of Prince Fahd bin Abdullah, president of the General Authority of Civil Aviation and chairman of Saudia and its board members.
Speaking at the signing ceremony, Al-Molhem added: "This is another important step toward privatization of the airline's strategic units and it was decided after conducting adequate studies with the support of international consulting firms."
The move was in line with the investment attractiveness of the Kingdom's economic sectors, its strong economic environment and the government's support to the private sector, he said.
Al-Molhem underscored the desire of investors to participate in Saudia's privatization process.
"This is a model of successful partnership between the public and private sectors," he said.
Meanwhile, Prince Fahd chaired a meeting of Saudia's board to discuss the organization's financial reports and operational performance during the first half of 2013, the Haj and Umrah plan for this year and the airline's efforts to modernize its fleet of aircraft, develop its IT infrastructure and improve services to passengers.
Prince Fahd urged the board members and Saudia staff to work hard for achieving the airline's strategic objectives and developing its services by improving operational performance and providing more seats to meet passenger requirements.
"We have to achieve higher operational rates to compete with other airlines at regional and international levels," the chairman said.
Al-Molhem gave a presentation on the airline's performance, showing record increase in the number of passengers carried by the airline compared to previous years.
In 2012, Saudia carried 23.9 million passengers with an increase of 2.43 million compared to the previous year and an increase of six million compared to 2008.
Saudia transported more than eight million passengers on international flights in 2012, registering an increase of 748,000 compared to 2011 and 13.8 million passengers on domestic flights showing an increase of 1.7 million passengers compared to the previous year, and four million passengers compared to 2008.
During the first half of 2013, the airline transported 11.72 million passengers with an increase of over 678,000 compared to the same period in 2012.
The number of passengers carried by the airline daily during peak seasons reached nearly 70,000 while daily flights in such seasons reached over 560.
"During the past months, Saudia worked for increasing its domestic and international flight network. We'll operate flights to the Canadian city of Toronto in the winter of this year and to Los Angeles in March 2014," the Saudia chief said, adding that the airline had made available more seats on its domestic and international flights.
The airline's on-time performance from January through June 2013 reached 89.59 percent compared to 87.49 percent during the same period in 2012.
"This is a good rate compared to the performance many other airlines in the region as well as American airlines."
He pointed out that on-time performance in July 2013 reached 92 percent.
Al-Molhem said Saudia received 65 new aircraft out of 90 aircraft it had ordered from Airbus and Boeing as part of its efforts to modernize its fleet.
Saudia presented its strategic plans to meet the requirements of domestic operations and emphasized the need to increase the number aircraft required for the sector, considering the growing number of passengers and the Kingdom's rapid economic progress.
"Studies have showed that the number of domestic passengers would increase to 28.5 million by 2020 with Saudia expecting to have a share of 22 million," the director general said.