Saudi Arabia’s sovereign wealth fund said to eye Boeing, Airbus jets for new cargo airline

Saudi Arabia’s sovereign wealth fund is in exploratory talks to line up Boeing and Airbus freighters for a new cargo airline as it looks to turn the kingdom into a logistics hub to rival Dubai and Doha, Bloomberg Reported.

The cargo-hauling operation would serve flag carrier Saudia and startup Riyadh Air, according to sources familiar with the matter, who asked not to be identified as the talks are private. The Public Investment Fund (PIF) is in discussions with both planemakers and lessors to acquire Boeing 777 and Airbus A350 freighters, the sources said.

The talks are at an early stage. No final decisions have been made, and the fund may ultimately decide to delay or scrap the plans.

Like its Persian Gulf rivals, Saudi Arabia is looking to take advantage of its location at a global crossroads connecting Europe, Asia and Africa amid booming demand for air freight. Air cargo shipments rose 14 per cent in June from a year earlier, the seventh consecutive month of 10 per cent or greater growth, according to the International Air Transport Association industry group. Shipments are on pace to exceed levels hit in 2021, a record year.

The move is part of a push by Saudi Arabia to diversify its economy away from a reliance on oil sales, with an emphasis on tourism, aviation and logistics. The kingdom has launched an aircraft leasing company, a helicopter firm, invested in Saudia’s engineering unit, and plans to develop one of the world’s biggest airports in its capital.