x Abu Dhabi, UAESaturday 22 July 2017

Kuwaiti and Saudi carriers move to modernise fleets

Kuwait Airways and Saudi Airlines strive to modernise their fleet, but still face hurdles to catch up with the big three: Qatar Airways, Etihad and Emirates.

Kuwait Airways and Saudi Airlines made moves this week to modernise their fleets. But to varying degrees, a leading analyst said, they still have some way to go before catching up with the region’s big three airlines.

On Wednesday, Kuwait Airways signed an agreement with Airbus to buy 25 planes and lease a further 12 planes. The purchased aircraft are A350-900s and A320neos, while the leased planes are A33os and A320s.

Delivery for the purchased planes is expected to start in 2019, while the leased aircraft will be delivered this December, Kuwait’s news agency reported

“Kuwait Airways’ fleet is exceptionally old and has significantly impacted its reputation. The average age of its fleet is about 20 years; at Emirates [Airline] it’s six years. This is exceptionally overdue modernisation,” said Will Horton, senior analyst at the Sydney-based Centre for Asia Pacific Aviation (Capa).

“Kuwait Airways has just under 20 aircraft, so there is some growth with these orders and leases, but from a low base,” he added.

Mr Horton said that the new purchase did not make Kuwait Airways a challenger to the Middle East’s big three carriers, but rather a “strong regional carrier with limited transfer”.

The value of the Kuwait deal was not disclosed, but according to local media its value is US$4 billion.

In comparison, the big three made a much larger splash at the Dubai Airshow last November. Etihad Airways ordered 56 Boeing 777s valued at $25.2bn at list prices. Emirates Airline made $99bn purchase of Boeing and Airbus planes. Qatar Airways ordered 60 aircraft – a mixture of Boeing 777X and Airbus A330 Freighters at the Airshow.

Separately, Saudi Arabian Airlines signed $1.87bn loan deal yesterday to fund the purchase of 17 planes, according to Bloomberg News. The new aircraft will be delivered over the next three years, as the Saudi carrier aims to modernise its fleet.

“The kingdom keeps a low-profile in regards to aviation. The airline sees the opportunity to start to be a network carrier like the Big Three. The question is if the government sees that too,” said Mr Horton.

He added that Saudi aviation had greater potential for growth in outbound flights rather than incoming.

“There is religious traffic but other inbound traffic is complicated by visa restrictions and limited interest,” said Mr Horton.

The Saudi aviation market also features flynas, a budget carrier that flies to 88 domestic and international routes. Last January, it launched a business class, mirroring its Dubai-based counterpart flydubai, which launched the service last October.

selgazzar@thenational.ae