Low-cost Saudi airline hopes for more equality through pending changes in Saudi Arabia’s regulatory environment
Saudi Arabia’s low-cost carrier Sama Airlines plans to start a new route to Khartoum in Sudan in the summer 2010.
The carrier currently serves seven international destinations Aleppo, Alexandria, Amman, Assiut, Beirut, Damascus and Sharjah from the three main airports in Saudi Arabia: Riyadh, Jeddah and Dammam.
The airline also plans to expand its fleet to 25 narrow-body aircraft over the next five years from its current fleet size, which includes six Boeing 737-300 aircraft.
In January, Sama announced that it would discontinue flying on its government-imposed public service obligation (PSO) routes from 2 February due to the kingdom’s delay in forming a comprehensive aviation policy that would allow for competitive pricing and recognise that private carriers should not be required to perform public services at a loss.
The government was due to create a policy addressing these issues by 15 November 2009.
However, Sama still serves five PSO airports of Ha’il, Rafha, Bishha, Tabuuk and Gurayat through the wet-lease or short-term lease of Jetstream 41 aircraft.
“The top priority is to sort out the regulatory environment with respect to long-standing fare caps on domestic fares within Saudi Arabia, fuel subsidies applied unequally to the domestic carriers and PSO route obligations applied unequally to the domestic carriers,” Bruce Ashby, Sama’s chief executive tells MEED.
Subject to pending changes in the kingdom’s regulatory environment, Sama also plans to add further international destinations and increased domestic routes within Saudi Arabia.
Sama is thought to have incurred more than SR50m in losses due to PSO flying since it began commercial operations in March 2007. Ashby earlier estimated that Sama pays about 10 times more for its domestic fuel than Saudi Arabian Airlines, which benefits from a fuel subsidy that is not available to private airlines.
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