Saudi Arabia’s biggest-ever plane order isn’t going to Boeing

Saudi Arabia’s national airline has placed an order for 105 Airbus airplanes in the largest-ever deal in the country’s aviation history — another win for troubled Boeing’s European rival. Ibrahim Al-Omar, director general of Saudia Group, the state-controlled owner of the Saudia airline and low-cost carrier Flyadeal, said Monday that the first planes would be delivered in the first quarter of 2026. “The Saudia Group announces today the largest deal in the history of Saudi aviation,” he said in a speech at the Future Aviation Forum in Riyadh, referring to the contract with Airbus. Saudia Group’s current fleet comprises 93 Airbus and 51 Boeing aircraft, according to its website. And the latest deal adds to the group’s existing backlog of Airbus orders of 39 aircraft, the European airplane maker said in a statement.
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Al-Omar did not specify whether it was the number of airplanes ordered or the total value of the order that made it Saudi Arabia’s biggest-ever aviation deal. When asked by CNN about that, as well as the value of the deal, Saudia Group did not respond, while Airbus declined to comment. But, in a press release, the organizers of the Future Aviation Forum said the new order totaled $19 billion. In a separate statement, Al-Omar said the new order would help realize Saudi Arabia’s Vision 2030, a program aimed at diversifying the country’s economy away from oil. A key part of the program is making the kingdom an attractive destination for tourists. “Saudia has ambitious operational objectives to meet growing demand,” Al-Omar said. “We are increasing flights and seat capacity across our existing 100-plus destinations on four continents, with plans for further expansion.” The country hopes to attract 150 million tourists per year by 2030, according to its National Tourism Strategy. News of the Saudi deal comes as Airbus’s main rival Boeing (BA) faces intense scrutiny over a series of safety failures, including a mid-air blowout of part of a fuselage in January. The incident has prompted a number of investigations into Boeing’s practices, an executive shake-up and promises that the company will turn itself around. But Boeing has been struggling ever since fatal crashes of its 737 Max aircraft in 2018 and 2019 resulted in a 20-month grounding of its best-selling plane. The company was also hit by the pandemic, which brought air travel to a near-standstill for months and caused deep losses at most of the airlines that buy Boeing’s planes. Since the start of the grounding in 2019, the company has reported adjusted losses totaling more than $31 billion. Since the beginning of this year, its stock price has tanked by almost 28%. Despite having a backlog of orders amounting to more 5,600 commercial jets, worth $529 billion, Boeing cannot make planes quickly enough each year to turn a profit as it’s working to address its quality issues. Meanwhile, Airbus, reported an order backlog of almost 8,600 aircraft at the end of 2023 and posted a profit of €3.8 billion ($4.1 billion) for the year.