EXCLUSIVE: Saudi Arabia unveils big plans for third largest airport

09 May 2018
A new 50-year master plan promises to transform King Fahd International airport into a major travel and cargo hub

Multiple initiatives are underway for King Fahd International airport, located 20 kilometres off Dammam in Saudi Arabia's Eastern Region.

These include the installation of a new baggage handling system, awarded to the Netherlands’ Vanderlande, and the provision of a 10-year fire and rescue services at the airport, awarded to UK-based Serco Group.

However, the most crucial of these initiatives is the development of a 50-year master plan awarded in 2017 to Spanish consultancy Ineco, which aims to develop the airport as a regional transport hub for passengers and cargo.

“The study was commissioned in line with a new strategy when Dammam Airports Company (Daco) was corporatised in July 2017,” says Turki Abdullah Aljawini, CEO, Daco.  “The new strategy must be reflected in a new masterplan… the study will extensively look at our strategic objectives and help develop new business plans.”

Daco, which now has full control of the King Fahd International airport's operation and management, is one of several airport companies that come under the umbrella of Saudi Civil Aviation Holding Company, a wholly-owned division of the General Authority of Civil Aviation (Gaca) tasked with overseeing the kingdom’s airports privatisation process.

While Aljawini remains tight-lipped about the airport’s privatisation timeline, he is very confident about the airport’s future despite a weaker-than-average growth in passenger traffic in 2017.

Some 9.8 million passengers passed through King Fahd International in 2017, some 200,000 more compared to the previous year.  This accounts for a 3 per cent increase, some 4 percentage points lower than the national average and significantly lower than the 10.6 per cent average annual growth seen for the airport since 2009.

However, the outlook for 2018 is so much more ambitious, with Aljawini saying he is aiming for a 6 to 8 per cent annual increase in passenger traffic. “I am confident we will deliver this growth… despite major infrastructure projects that might cause certain inconvenience,” the executive says.

Aljawini’s optimism arises from the broad reforms and policy changes that he says will increase the overall attractiveness of Saudi Arabia and the Eastern Province for passengers and cargo and for both business and leisure travel.

According to the executive, the relaxation of visa rules, the new Red Sea attractions as well as the airport’s catchment area – within the proximity of oil giant Saudi Aramco’s headquarters in Dhahran and within a driving hour to Jubail industrial city - will help deliver growth this year.

Indeed, the first quarter results are promising; the airport reported a 4.2 per cent increase in passenger traffic year-on-year, and the figure is expected to further improve during the Ramadan and summer season, when air travel in the kingdom peaks.

50-year master plan

It is not the first time that a master plan is being developed for King Fahd International airport. A previous master plan has set milestones until 2041.

One of the milestones set in the previous master plan is the two-phased expansion of the terminal between 2019 and 2025 and, in the succeeding 15 years, the construction of cargo aprons, storage and car parking areas, an airport city and a potential 11 kilometre railway that links the airport to the Damman rail station.

Aljawini says the new master plan, extending into 2047 and expected to be completed in July, could bring the timeline for some projects forward or push others back by a few years depending on the airport’s business requirement.

“It’s all a matter of managing our cash flow. Do I need to expand the terminal now or implement new additional infrastructure to improve capacity and see if it holds for two or three more years depending on demand?” asks Aljawini. “Obviously we will be expanding the terminal, it is just a matter of deciding when.”

As it is, the airport is the largest in Saudi Arabia in terms of land area, and so far only half of the built structure is being utilised for airport processes. The entire airport terminal, if fully utilised, could push the airport’s capacity to up to 30 million passengers a year, more than twice its current capacity of 12.6 million.

Aljawini maintains a pragmatic view of the airport’s planned expansion. “We will undertake a regular review of the master plan… we understand that we will reach a dead end in terms of capacity. Once we know exactly our dead end, whether 14, 16 million [passengers a year], then we will go back and review when we require the expansion.”


Competition, whether from Bahrain International airport or from the planned new airport in Jubail, does not seem to put off Aljawini.

“Every airport has its own catchment area. If you look at the map, we are close to major international oil and petrochemical industries, the petrochemical complex [in Jubail] is just an hour away, and this entire area has a population of 4.3 million people,” Aljawini argues, adding that a new, smaller airport in Jubail will have a limited impact on passenger traffic at King Fahd International.

The executive adds that they have already overtaken Bahrain International airport in terms of passenger traffic since 2013 and that they expect the airport’s strategic location to fuel both passenger and cargo traffic over the long-term.

Even the existing King Fahd Causeway and the planned King Hamad Causeway linking Bahrain and Saudi Arabia are expected to compete with the airport but Aljawini maintains strong confidence on their catchment area. “Every airport has its strengths… there will always be competition,” he says.

Operating a second airport

Daco is already setting its sights towards expanding its remit beyond King Fahd International just under a year since its inception. According to Aljawini, the firm is expecting to receive clearance from authorities in the first half of 2018 to take over the operations of a second airport.

As it pursues opportunities at other airports, Daco, under Aljawini’s leadership, is determined to fulfil its mandate not only to transform King Fahd International into a major travel hub but in ensuring that modernisation of other airports in the kingdom will come sooner than later.

A MEED Subscription...

Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.