Saudi Arabia approves new Dammam-based budget airline backed by Air Arabia

21/07/2025 01:11 AST

Saudi Arabia has granted a low-cost airline license to an Air Arabia-led consortium, aiming to boost air connectivity, create jobs, and upgrade transport in the Eastern Province.

The new carrier, a joint venture between the UAE-based budget airline, KUN Investment Holding, and Nesma, will be headquartered at Dammam's King Fahd International Airport. It is expected to operate both domestic and international routes, helping expand access and competition in the Kingdom's growing aviation market.

According to the General Authority of Civil Aviation, the new airline aims to serve 24 domestic and 57 international destinations, transporting around 10 million passengers annually. Its operations will be supported by a fleet of 45 aircraft and are projected to create more than 2,400 direct jobs, aligning with Saudi Arabia's Vision 2030 goals to boost the non-oil economy and local employment.

In a statement, GACA stated: "This move aims to enhance air connectivity in the Eastern Province, increase seat capacity, and provide passengers with competitive options."

The announcement comes as part of broader efforts to transform Saudi Arabia into a regional aviation hub. The country plans to handle 330 million passengers and transport 4.5 million tons of air cargo annually by 2030, under the National Strategy for Transport and Logistics Services.

As part of this strategy, Eastern Province Gov. Prince Saud bin Naif bin Abdulaziz also inaugurated the master plans for King Fahd International, Al-Ahsa, and Al-Qaisumah airports, alongside a new corporate identity for Dammam Airports Co. The governor also launched a SR1.6 billion ($426 million) development package covering 77 infrastructure projects to improve passenger experience and airport services.

King Fahd International Airport handled 12 million passengers in 2024, up 15 percent from the previous year, with over 99,000 flights recorded, according to data from Dammam Airports Co. The airport also set a daily passenger traffic record, surpassing 50,000 travelers in a single day for the first time.

With air traffic steadily rising and infrastructure rapidly expanding, the introduction of a new budget airline based in Dammam is expected to solidify the region's position as a key aviation gateway and support Saudi Arabia's ambitions to lead the Middle East civil aviation sector by the end of the decade.

Arab News