Saudi Aviation Regulator EVP Outlines Huge Growth Plans

Air travel is destined to be a major plank in Saudi Arabia’s Vision 2030 policy to diversify away from its hydrocarbon-dominated economy.

New airlines, airports, safety standards, even new consumer protections, are all in the works as Saudi Arabia starts to push through measures to expand its aviation sector at a rapid rate.

Overseeing this is the General Authority of Civil Aviation (GACA), the country’s regulator.

The organization’s EVP strategy and business intelligence, Mohammed Alkhuraisi, notes that aviation, as part of the overall logistics sector, is an enabler to almost all of Vision 2030’s objectives, including the creation of a tourism sector that will appeal to a global audience, not just pilgrims arriving for the Hajj and Umrah.

For the past few years, the target number for tourist arrivals has been widely publicized as 100 million annually by 2030. That figure, Alkhuraisi said, has recently been revised to 150 million.

Over the past year, the country’s new, yet-to-be launched full-service flag carrier, Riyadh Air, has garnered considerable attention, with an order for 39 Boeing 787-9s and -10s (plus 33 options) and a large narrowbody order expected imminently.

According to Alkhuraisi, there is likely to be a third order, this time for dedicated freighters. Those will play a role in another part of the Vision 2030 masterplan, namely increasing the annual cargo throughput at the nation’s airports from 1 million tonnes today to 4.5 million tonnes by the end of the decade.

Although much attention in recent months has been focused on Riyadh Air, there are two more new Saudi airlines waiting in the wings.

One, Neom Airlines, is targeted solely at flying visitors into the huge new resorts and the futuristic city known as The Line being built in the northwest of the desert nation.

Little is known about Neom Airlines. “It’s quite early stages,” Alkhuraisi said. “There’s no visibility on when they are going to fly; they have yet to start their AOC process.”

The second proposed new carrier is an LCC based in the eastern city of Dammam, for which a public tender is underway and for which four proposals have been received “from four different global companies,” Alkhuraisi said.

“I can’t give details, but we’re at a very advanced stage,” he said. A decision on the winning bid could be announced shortly after November’s Dubai Air Show “but we’re not putting deadlines on ourselves.”

The successful bidder may be a purely Saudi operator or a joint venture with a foreign partner—Wizz Air has been suggested in some quarters—but under Saudi law, the majority shareholding must be Saudi-held.

These developments are on top of the continued expansion of current flag carrier Saudia, its LCC subsidiary flyadeal (with which it is about to supply a batch of Airbus A321neos) and the country’s other LCC, flynas, which has the intention of growing its fleet from just under 60 aircraft to 250.

There have been suggestions that Saudia will effectively be relegated to a secondary role, specializing in flying religious tourists once Riyadh Air starts operations in 2025, but Alkhuraisi insisted this will not be the case. While the commercial development of both Saudia and Riyadh Air is a matter for their respective boards, Saudia will remain a full-service carrier.

Will this major airline expansion bring with it a risk of overcapacity? Alkhuraisi believes not. There is a shortage of capacity today and the country “is leaking heavily to foreign carriers,” he said. Winning back market share, as well as expanding the nation’s international connectivity to a planned 250 destinations, will mop up considerable numbers of seats. 

That increased connectivity will be funneled through a series of new or greatly expanded hubs.

NEW AIRPORT

The new King Salman International Airport in the capital, Riyadh, is being designed to accommodate up to 120 million passengers by 2030 and 185 million by 2050. The new facility will incorporate the current King Khalid International Airport and eventually supersede it.

Almost as extensive will be the expansion of Jeddah’s King Abdulaziz International Airport. This received a major makeover in 2020, when the rundown North, South and Hajj terminals were replaced by a new facility with a 30-million passenger annual throughput.

“We need to add two similar terminals that will most likely be adjacent to the new one,” Alkhuraisi said. “That will take [capacity] to 70-80 million. Add to that the renovated old North, South and Hajj terminals and that will amount to 100-110 million passengers over the next 10 years.”

Additionally, the new Neom Bay Airport in the northwest will be replaced by Neom International, with Neom Bay probably becoming a general aviation facility. The new Red Sea International Airport will be a boutique facility, catering to the upscale resorts currently under construction.

GACA is also overseeing changes to the regulatory environment, which has so far been based on FAA regulations. GACA is now studying a move to a new system that will be balanced between FAA and EASA regulations “in a way that’s tailored to Saudi Arabia’s needs.”

And passengers will soon receive a new cluster of consumer rights, overhauling existing regulations in areas such as denied boarding and lost baggage.

With all these developments rapidly gathering pace, the effects of Saudi Arabia’s seismic aviation changes are likely to be felt well beyond the Middle East.