Saudi Arabian Airlines offers its customers the convenience of Self Check-in.

Air travel rise spawns competition
SAUDI ARABIAN AIRLINES

A growing economy and the development of several new business and technology parks in Saudi Arabia mean that travel is a booming industry. Saudis spend around SR60 billion (£7.9 billion) annually on domestic and international travel and tourism, and passenger numbers are on the increase. As a response to this growing demand, and in line with the Kingdom’s initiatives to open up to private investment, the domestic air sector has been opened for competition. Although Saudi Arabian Airlines has been the sole carrier for the past 60 years, the company welcomes the decision, arguing that competition in this sector is beneficial for companies and customers alike. Saudi Arabian Airlines announced in April that it too is considering launching a low-cost service.

Khalid A. Almolhem, the airline’s director general, has set up 11 working teams to manage the different strategic units created to strengthen the company in the face of increased competition. These include the proposed new budget service, still under internal discussion, and a separate service for Hajj and Umrah travellers.

Growing competition is not the only reason for Saudi Arabian Airlines to build on its strengths. The Saudi Minister of Defence and Aviation signed a contract in October 2000 to conduct studies for the airline’s privatisation; in preparation for this, major restructuring is under way within the organisation. Saudi Arabian Airlines’ support services, such as ground handling operations and maintenance, as well as the Prince Sultan Flight Academy in Jeddah, are going to be turned into discrete commercial units. So far, the privatisation process is on schedule. The organisation will be split into six strategic business units (SBU) each with its own strategic partners, functional departments and investors all under the umbrella of the mother company – Saudi Arabian Airlines. The first of these SBUs was the Catering department and with that process on schedule, next in line is the Cargo department. Youssef A. Attiah, vice president of Customer Services, believes that all changes are for the convenience and comfort of the passenger; increased competition and restructuring are merely opportunities for company improvement.