Air Arabia Consortium Cleared to Launch New Budget Airline in Saudi Arabia

Saudi Arabian authorities have officially cleared a consortium led by the UAE's Air Arabia Group to launch a brand new low-cost airline within the kingdom. Speaking in a statement on Monday, the Sharjah-based carrier revealed that the upcoming airline expects to serve 81 destinations—split between 24 domestic and 57 international locations—by the year 2030.

The group successfully secured an air operator certificate from the General Authority of Civil Aviation (Gaca) to initiate flights originating from King Fahd International Airport in Dammam. Air Arabia is partnering in this consortium alongside Nesma Group and KUN Holding. Together, this trio previously won the bid to establish and operate the new airline back in July 2025.

The yet-unnamed carrier is projected to significantly boost tourism throughout the Eastern Province while generating over 2,400 direct jobs. By 2030, the airline aims to maintain a fleet of 45 aircraft and transport roughly 10 million passengers annually.

“The launch … will contribute to enhancing competition and improving performance in the air transport market, while supporting trade and tourism in the Eastern Province and creating new local employment opportunities,” stated Sulaiman Almuhaimedi, Gaca's executive vice president of aviation safety and environmental sustainability.

Saleh Al Jasser, Saudi Arabia's Minister of Transport and Logistic Services and chairman of the General Authority of Civil Aviation, formally presented the air operator certificate to the group. According to officials, the licence was granted after the consortium met stringent criteria ensuring “the highest levels of safety and operational compliance,” reflecting Gaca's ongoing commitment to building “an attractive investment environment.”

Broader air travel across the Middle East has faced disruptions due to the ongoing US-Iran war. Regional airspaces, particularly within the Gulf, experienced shutdowns during the early weeks of the conflict that began on February 2. Operations have since recovered incrementally as major carriers like the UAE's Emirates and Etihad Airways, Saudia, and Qatar Airways brought back flights following comprehensive safety assessments. While select international carriers have gradually restored services, others have prolonged their suspensions while keeping a close eye on developments.

Despite these challenges, the Middle East aviation sector demonstrates notable resilience, with analysts forecasting a robust postwar rebound comparable to the recovery seen after the Covid-19 pandemic. As the Arab world's largest economy, Saudi Arabia continues heavily investing in its aviation sector. The kingdom's overarching Vision 2030 economic diversification programme prioritizes aggressive fleet expansion, airport construction, enhanced facilities, improved air connectivity, and robust tourism promotion. As part of these broader goals, Saudi Arabia also launched Riyadh Air in 2023.

Across the wider Gulf region, aviation momentum continues to build. Dubai Airports chief Paul Griffiths recently described the emirate's aviation sector as experiencing a “trampoline bounce” effect driven by strong recent growth. Additionally, Wizz Air announced plans to restore eight routes connecting Abu Dhabi and Dubai with European cities starting in October, bringing 32 weekly services back to the UAE.

Air Arabia, which commenced operations in 2003, currently manages a fleet exceeding 90 Airbus A320 and A321 aircraft. The airline holds a major order for 120 Airbus aircraft, with deliveries officially underway as of 2025, operating primarily from six key hubs located in Sharjah, Ras Al Khaimah, Casablanca, Alexandria, Abu Dhabi, and Karachi.