JEDDAH, 23 April 2005 — Saudi Arabian Airlines said yesterday it will buy 15 new aircraft to fly domestic and regional routes and boost its 139-strong fleet.
The board of directors, headed by Prince Sultan, second deputy prime minister, minister of defense and aviation, and chairman, approved the purchase at its meeting recently. A company official said all 15 planes will be the same 66-seat model but declined to give further details.
Reuters quoted analysts as saying the deal could be worth up to $450 million at catalog prices and would likely go to Brazil’s Embraer, Canada’s Bombardier or ATR, a unit of Airbus parent EADS.
“Saudi Arabian Airlines is the first airline in the Middle East to purchase this type of aircraft. These planes will be configured in a two-class layout with a total of 66 seats, of which six will be for first class,” Dr. Khaled Ben-Bakr, director general, said. “The aircraft will offer optimum comfort and a highly reliable service and the purchase is fully self-financed by the airline,” he added.
Industry sources said the cost of each plane was likely to be between $20 million and $30 million, excluding maintenance and other costs. Nearly 10 years ago the national carrier had signed a $6 billion deal for the purchase of 61 state-of-the-art aviation technology aircraft from Boeing and McDonnell Douglas in Washington. The planes included 23 Boeing 777s, 5 Boeing 747-400s, 29 McDonnell Douglas MD-90s, and 4 MD-11 freighters. All 61 aircraft were delivered by the year 2001.
Ben-Bakr said the fleet had helped in the development and improvement of services of the airline, opening of new routes, increasing frequencies and had enhanced its standing among the leading airlines of the world.
The aircraft had also helped in meeting the summer rush, promote domestic tourism, and increase Haj and Umrah flights with better facilities for pilgrims.
The four MD-11 freighters had opened up new horizons for the airline’s cargo sector.
It is expected that as people — both Saudis and expatriates — are preferring to spend time at tourist sites and resorts in increasing numbers within the Kingdom and the region, the 15 new aircraft would be able to meet the rush with better facilities and more frequencies.
Abdulrahman Al-Tuwaijri, secretary general of the Supreme Economic Council, said in an interview this week that Saudi Arabia will this year grant a license for a second airline and further liberalize the telecoms sector as part of a raft of economic reforms. “We expect to award a license to a private airline company before the end of 2005. Next year, we will award the third mobile phone license as well as the second landline telephone license,” said Al-Tuwaijri, speaking on the sidelines of the 2005 Privatization of Infrastructure Facilities conference in Abu Dhabi.
Any second private airline would initially only operate within the Kingdom, Al-Tuwaijri said. “It could be that a national company will be given the license but it is not finalized as yet. However, privatization of Saudi Arabian Airlines is underway. Advisers are nearly finishing their part of the work.”
