Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), is exploring the establishment of a new cargo airline to position the kingdom as a major global logistics hub competing with the likes of Dubai International and Doha Hamad International, Bloomberg reported citing unnamed sources familiar with the matter.
The planned cargo operation would support Saudia (SV, Jeddah International) and start-up Riyadh Air (RXI, Riyadh) and the PIF is in exploratory talks with manufacturers and lessors to acquire B777 and A350 freighters, according to the report. However, the talks are preliminary and the fund may ultimately opt to delay or scrap the plans.
ch-aviation contacted the PIF, Riyadh Air, and Saudia for comment. Boeing and Airbus do not comment on talks with airlines or potential customers.
The initiative is part of Saudi Arabia’s broader strategy to diversify its economy away from oil dependency, focusing on tourism, aviation, and logistics. The kingdom has already launched an aircraft leasing company, invested in Saudia’s engineering unit, and plans to develop a major new airport in Riyadh. Riyadh Air, a PIF-backed start-up, aims to compete with regional giants like Emirates and Qatar Airways. According to the ch-aviation fleets module, Emirates has 15 and Qatar Airways 28 freighters in their respective fleets. In addition, Emirates has five B777-200Fs and Qatar Airways thirty-four B777-8Fs on order.
Saudia is being reoriented to concentrate on religious pilgrimages and its cargo operations would be incorporated into the new venture, the sources said. According to Bloomberg, Saudia’s ownership could be transferred to the PIF as soon as 2025.
Saudi Arabia aims to leverage its strategic location at the crossroads of Europe, Asia, and Africa to capitalise on the surging demand for air freight. In June, the International Air Transport Association (IATA) reported that volumes measured in cargo tonne-kilometres (CTKs) rose 14.1% year-over-year globally, with international operations seeing a 15.6% increase. This marks the seventh consecutive month of double-digit growth.
