Saudia Arabia is expected to announce a multi-billion-dollar aircraft order in the coming days as part of the Kingdom’s highly ambitious (and incredibly expensive plans) to create and build a new international airline that will take on the likes of regional incumbents like Emirates in record time.
Various sources claim Saudi Arabia’s sovereign wealth fund is in advanced talks with European aircraft manufacturer Airbus, as well as the US aerospace giant Boeing for as many as 80 jets to kick start its new airline which goes by the working title of RIA.
On Sunday, sources cited by Reuters claimed Saudi’s Public Investment Fund (PIF) was nearing a deal with Airbus for around 40 of its next-generation A350 long-haul jets, while Bloomberg quoted insiders who said the airline’s backers were also in talks with Boeing.
RIA is to be bankrolled by the Public Investment Fund to the tune of $30 billion, and although the Kingdom hasn’t formally announced a launch date for the airline, the country is aiming to have 30 million transfer passengers passing through its airports within the next eight years.
An aircraft order on this scale is likely to take a big chunk of RIA’s launch budget, with the A350 order costed at more than US $12 billion at list price – although, airlines rarely, if ever, pay the full list price.
RIA will likely play Airbus off against Boeing in an attempt to secure the best deal. The airline is looking to build a fleet of single-aisle and widebody jets and sources claim both the Airbus A230 series and Boeing 737MAX lines are being assessed.
The Airbus A350 is also said to be winning the race as RIA’s first widebody jet, but the airline is reviewing Boeing 787 Dreamliner, and both could become part of the carrier’s fleet.
Tony Douglas, the soon-to-be ex-chief executive of Abu Dhabi’s Etihad Airways is said to have been poached by RIA to help launch the airline. Douglas hasn’t yet confirmed the move, but he announced his departure from Etihad last week so as to pursue opportunities “elsewhere”.
Douglas was credited with turning around Etihad’s ailing fortunes over the last few years, and the British-born aviation executive has years of experience of working in the Middle East. Arabian Business reports that a slew of other senior executives are to leave Etihad and join Douglas at RIA.