Interview: Ibrahim Al Omar, Director-General, Saudia Group
What strategies are most effective for managing cooperation and competition in the aviation industry?
IBRAHIM AL OMAR: In 2023 Saudi Arabia celebrated achieving a key objective of Vision 2030 of attracting 100m tourists by 2030 – seven years ahead of schedule. This success has led to a revision of the National Aviation Strategy’s targets, with the goal now being 150m visitors and 330m airport users. This change indicates that growth is surpassing expectations, and the market is expanding more rapidly than anticipated.
Even before the adoption of Vision 2030, the GCC was set to experience rapid growth in aviation. This suggests that there is space for new airlines to enter the market. However, the industry operates on thin margins. Since it plays a key role in supporting growth through tourism, business and trade, any expansion must be carefully handled through effective collaboration. Instead of direct competition, a more complementary approach is encouraged. This strategy is aligned with Vision 2030 and the National Aviation Strategy, which advocate for serving market needs in a collaborative manner. Such an approach ensures sustainable long-term growth in an environment where new entrants can coexist and contribute to the sector’s expansion.
Which segments within the aviation sector are expected to see significant growth?
AL OMAR: When considering growth potential across the industry, it is essential to recognise the pivotal role that airlines play. They act as primary customers for most business segments, including areas like maintenance and training, and account for a significant portion of operations. Substantial development is predicted in two key verticals other than passenger flights. First, the maintenance sector, especially for aircraft components, parts and engines, presents considerable opportunities for growth. This sector is anticipated to expand significantly due to the rising demand for maintenance services as the market continues to welcome new players.
Second, the training sector holds potential for growth. The demand for training extends beyond pilots to include the growing need for trained cabin crew and other aviation professionals. With ambitious future targets set across the industry, the demand for well-trained personnel will undoubtedly increase. Therefore, both the maintenance and training sectors are poised for growth in the coming years, supporting not just airlines but the broader aviation ecosystem.
Where do you identify sustainability-related opportunities and challenges for airlines?
AL OMAR: The array of options – from sustainable aviation fuels and operational efficiencies, to future technologies like hydrogen-powered or electric aircraft – presents a challenge. There is intense debate across airlines on which option to prioritise, with airlines aiming to tackle multiple fronts simultaneously.
In terms of immediate action, airlines such as Saudia are focusing on fleet renewal. We have ordered fuel-efficient aircraft like the Airbus A321neo and the Boeing 787-10, which help reduce carbon emissions. In addition, we are exploring new partnerships, including our involvement in the voluntary carbon market and programmes to incentivise passengers to make environmentally friendly choices.
Airlines are looking at solutions like electric vertical take-off and landing aircraft, with Saudia having purchased up to 100 electric jets. These are ideal for our market given geographical and climatic conditions, and they will be used for various purposes, including supporting developments like the Red Sea Project.
Moving forwards, fuel is set to be a primary focus, with about 80% of carbon emissions related to fuel. Saudia is collaborating with major players in order to hasten the introduction of low-carbon and sustainable jet fuel. This aligns with the Kingdom’s wider initiatives and is expected to be a key component of Saudia’s net-zero roadmap, which we expect to publish in 2024.
Read More from OBG
