The Business Year

A new regulatory environment is boosting competitiveness and activity in a sector that is displaying all the hallmarks of a boom.

Faisal Saleh Al Turki

President, Nesma Airlines

We were issued a license in October; it took us a year to get the license done and we started a month later. This is a reflection of the changes taking place in the General Authority of Civil Aviation (GACA), which was supportive of our aircraft operators certificate (AOC) licensing process. It provided us all the resources we needed to get things done quickly. The Kingdom has Saudia, which started 70-80 years ago and the process when it was launched would have been different so it never really went through this application process. When Sulaiman bin Abdullah Al-Hamdan took over and the management at GACA changed, it truly pushed us to help get things done. It took us pretty much a year to go from an initial approval of the idea and the concept of the airline to going through the entire process of hiring people, getting our manuals done, and then the proving flights. These are non-revenue non-commercial flights that are operated under inspection of GACA; it reviews operations and pilots for over 50 hours. All of this was completed in a year. The short duration of this process is a record for Saudi Arabia. We are the fastest airline to go from initial concept to getting the license and it took us just another month or two to begin flying.

Bandar Abdulrahman Al-Mohanna

Group CEO, Nas Holding

The performance of Flynas does not come as a surprise because we have been working with a structured plan based on the economic and competitive environment for the last few years. We made our plans with the objective to turn the company to profitability by the end of 2015; the target was achieved. At the same time, GACA started reforms in the industry by gradually removing the price cap, trying to provide fair treatment among the national carriers. The result of relaxing the price cap was a massive increase in domestic flights, which reflects basically the economic theory that price caps are not good and lead to capacity shortages. Since 2015 the government has been gradually lifting the price cap and this has given us more opportunities in the market and we believe it should be completely removed as soon as possible for fair competition and improving efficiencies. The strategy that we have put into place has been the right one; we have rebranded the airline, positioning ourselves a “smart choice airline“ instead of low cost, focusing more on our customers, with our performance based on efficiency.

Faisal G. Kayal

CEO, Faisal G. Kayal

Diversification is one thing that has become a focus, just like any other industry. Private aviation and the general aviation sector are still considered to be a young business in Saudi Arabia and therefore a lot of development has taken place over the last five years. This is part of the life cycle of the industry and is needed to reach a more mature stage. SPA is the investment arm of Saudi Arabian Airlines in the private aviation sector. We feel our responsibility as the largest player in the market is to try and contribute more to the restructuring of the sector in the Kingdom. Our starting point was as part of the overall 2020 transformation vision of Saudi Arabian Airlines. Out of that we have developed our five-year strategic plan and that basically revolves around the integrated private aviation business model. For us integrated means four plus one, meaning five lines of business. The first arm is the charter business that we have been operating for over 30 years. We have 10 aircraft of our own, both Hawker and Falcon. We have also expanded into aircraft management, which we were not involved in before.



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