The airline aims to connect to over 100 destinations. Image Credit: Saudi Press Agency

Riyadh: Saudi Arabia’s new national carrier will “move with real pace” to expand into a major airline as the oil-rich kingdom seeks to improve connectivity to the rest of the world, CEO Tony Douglas said a day after the country placed a $37 billion order for widebody aircraft with Boeing Co.

Owned by Saudi Arabia’s sovereign wealth fund, Riyadh Air will buy more planes after announcing the purchase of 39 Boeing 787-9 jets, with options for 33 more, Douglas said in an interview with Bloomberg Television. The deal announced on Tuesday was the result of a “rigorous campaign” involving Boeing and rival Airbus, Douglas said, adding that the company would declare the winner of the next deal soon, without providing details.

“Historically we’ve been nowhere near as well served as the hubs of the other airlines,” Douglas, who previously led Abu Dhabi-based Etihad, said in an interview from Riyadh. “There will be more orders to follow and it will enable us to put connectivity into places that fulfill the ambition of the nation, but for the avoidance of doubt, this will be commercially sustainable.”

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The launch of Riyadh Air, which was formally announced on Sunday, is part of Saudi Arabia’s strategy to help kick-start its tourism industry and make it a more popular destination for leisure and business. Crown Prince Mohammed Bin Salman is investing in resorts and airports as part of a plan to wean the economy off a reliance on oil sales.

Riyadh Air will take delivery of its first 787s in early 2025, Douglas said. The fledgling carrier doesn’t plan on leasing aircraft before then as “we don’t want to start with a product that is not consistent” with the experience the carrier hopes to offer its customers, the CEO said.

“We don’t have a legacy so we don’t need to go about how we interact with our guests in a conventional way,” Douglas said, calling his new airline a startup.

Alongside the Riyadh Air order, Boeing announced that existing flag carrier Saudia will purchase 39 787s with a top-up option for another 10.

The airline has already received more than 70,000 applications for possible openings in the days after it was announced, Douglas said, and the kingdom has the ambition to turn Riyadh airport into a global hub to provide a seamless passenger experience.

Douglas predicted that ticket prices across the industry will remain high, partly because they were unrealistically cheap at many airlines before the pandemic. The squeeze is a simple result of supply and demand, coupled with the fact that many airlines don’t have their full fleets back in service after the pandemic.