Airbus to source titanium from Saudi Arabia as part of jet deal

Airbus SE plans to source some metal to manufacture its aircraft from Saudi Arabia as part of a widebody aircraft deal with the kingdom’s flag carrier. 

The European manufacturer signed a deal on Wednesday to buy 2.5 billion Riyals ($666 million) worth of raw material, mainly titanium, from Saudi Arabia. The accord also included an order from national carrier Saudia for as many as 20 long-range aircraft.

Sanctions tied to Russia’s invasion of Ukraine have made it harder for Airbus, Boeing Co. and their subcontractors to secure raw materials like titanium, driving up prices. Planemakers and airlines are also grappling with the potential fallout from President Donald Trump’s reciprocal tariffs and the impact it will have on an already strained aerospace supply chain. Russia is a key supplier of the light-weight metal, which is used in making everything from spacecraft to iPhones and luxury watches.

The agreement, which includes an order for 10 A330neos and the right to purchase 10 more, is part of the kingdom’s push to develop into an aviation and tourism hub and localize manufacturing in an array of industries including aircraft and automotive. That includes spending billions on new aircraft for the flag carrier and new startup airline, Riyadh Air, as well as new airports and luxury resorts. 

The order is the latest vote of confidence for Airbus’s A330neo model, which is enjoying a second wind because of its better availability and favorable economics as long haul travel rebounds from the lows of the pandemic.