Saudia Backs Boeing 777-300ER

Saudia Backs Boeing 777-300ER

Summary

Saudia plans on buying 63 aircraft from Boeing and Airbus.

Order for Boeing wide body aircraft would be a welcome one.

Airline could get some additional discounts due to order size and current market environment.

Saudia or Saudi Arabian Airlines has revealed its intention to order over 60 aircraft from Boeing (NYSE:BA) and Airbus (OTCPK:EADSF). The news comes at a time in which Boeing is facing problems placing its wide body aircraft with airlines.

Saudia is planning on acquiring a total of 63 aircraft as part of their fleet renewal program and expansion plans. The carrier plans to grow its fleet from 119 aircraft currently to 200 aircraft in the coming years. Saudia plans to add international as well as domestic routes. Including freighter aircraft, the Saudia fleet is 9.4 years old, which is relatively young.

Airbus remains dominant in Saudia narrow body fleet

In 2012 the domestic market was liberalized, leading to a surge in income from Saudia’s domestic network. The airline aims to expand its existent network and plans to order 35 aircraft to facilitate this growth. The airline currently has 52 Airbus narrow body aircraft in its fleet and 1 unfilled order and plans to acquire 35 Airbus A320neo and A321neo aircraft. So as expected, Saudia stays loyal to the Airbus A320.

Boeing remains dominant in Saudia wide body fleet

Next to acquiring narrow body aircraft, Saudia is planning on acquiring 15 Boeing 777-300ER aircraft and 13 Boeing 787 aircraft.

The 15 Boeing 777-300ER will likely be used to replace some of the older Boeing 747-400 aircraft that Saudia has been leasing from various lessors. For Boeing this order is extremely important, since it is facing a significant gap in production as it transitions from the Boeing 777-300ER to the Boeing 777X production. An order for 15 aircraft, at current announced rates, would mean 2 months of production.

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