The Saudi business-class carrier will ground its fleet of four Airbus A319 aircraft due to the drop in demand caused by the economic downturn.

Officials at the airline’s holding company National Air Services (Nas) say the carrier is no longer financially viable.

The decision to suspend Kayala was taken after an extensive study of passenger demand set against financial returns. However, Nas says that it will consider opening a similar operation in future.

Nas also owns the low-cost carrier Nas Air, which has struggled with the state-imposed fare cap on domestic flights.

However, a senior official at Nas says the closure of Kayala did not have implications for the budget carrier.

“Nas as a whole is not in trouble,” he says.