Nesma Airlines to launch domestic Saudi flights in November

The airline’s focus on poorly-connected regional markets gets the nod from country’s regulators

Martin Rivers

Published: Updated:

Nesma Airlines expects to launch domestic flights in Saudi Arabia this November, becoming the country’s third or fourth operator alongside fellow start-up SaudiGulf Airlines and incumbents Saudia and Flynas.

The Saudi-owned, Egypt-based airline presently operates flights between the two countries with three Airbus A320s and one A319. Its domestic Saudi operation will connect the northern city of Ha’il with 12 points around the kingdom, utilising a pair of ATR 72-600 turboprops. The initial routes flown by the 68-seaters will be Jeddah, Riyadh and Dammam.

“We will build our business model at Ha’il in two directions – first one, direct flights to Ha’il; and the other one, feeder flights,” managing director Ashraf Lamloum tells Al Arabiya English, confirming that the airline received its Air Operator’s Certificate (AOC) in August. “We are trying to use Ha’il as a hub by feeding some passengers to other destinations.”

Domestic air travel in the kingdom is currently dominated by flag-carrier Saudia – which operates 75 per cent of internal flights – and privately-owned Flynas.

The General Authority of Civil Aviation (GACA), Saudi Arabia’s aviation regulator, granted economic licences to two start-ups in December 2012 in order to break the duopoly, but nearly four years on neither carrier has launched services.

Stalled liberalisation

SaudiGulf, owned by Abdel Hadi Al-Qahtani & Sons Group, is in pole position following the granting of its AOC in June. The airline plans to begin services with four A320s from its base in Dammam, initially serving Riyadh and Jeddah. It will later enter the Jeddah-Riyadh trunk route and add international flights to Dubai, before scaling up with 16 Bombardier CSeries CS300s.

Al Maha Airways, a subsidiary of Qatar Airways, was also designated an approved operator in 2012, but has failed to match SaudiGulf’s progress. Chief executive officer Mike Szücs and chief operating officer Mark Breen no longer work for the company, which has neither received its AOC nor announced concrete plans for a launch.

Asked how Nesma managed to secure its operating licence so quickly despite not being involved in the 2012 bidding process, Lamloum says the airline’s focus on poorly-connected regional markets won the approval of Saudi regulators.

“Ha’il is an area that is under-served and in need of immediate action to cover its demand and requirements,” he explains, noting that the city is only served by four other carriers: Saudia, Flynas, Air Arabia and Flydubai.

Nesma already flies to Ha’il from its Cairo hub – one of nine routes to the kingdom operated under the airline’s Egyptian AOC.

Lamloum also credits his operational team with “having everything in its right place” before attempting to obtain regulatory approval. GACA repeatedly blamed the delays with SaudiGulf and Al Maha on unspecified regulatory compliance issues.

Ha’il regional hub

Following the launch of its initial three routes – each of which is already served by incumbent Saudi operators – Nesma will branch out into nine brand new markets for Ha’il: Al Jawf, Arar, Gassim, Madinah, Qaisumah, Qurayyat, Rafha, Tabuk and Turaif. Its expansion will be propelled by the arrival of another two ATR 72-600s later this year.

“We are planning to start [the Saudi operation] with ATRs, but also we have another plan to add some Airbuses into our Saudi AOC,” Lamloum continues, identifying A320s and stretched A321s as the preferred types. The Airbuses would initially join the fleet under a wet-lease arrangement, whereby a foreign operator provides aircraft and crew on a short-term basis.

Nesma’s Egyptian unit is actively looking to source three A320s or A321s by May 2017, the managing director adds, without confirming if those units will be made available for wet-leases.

As well as its main base of operations in Ha’il, Nesma’s Saudi division is evaluating setting up ‘another hub’ in Jeddah, Riyadh or Dammam. International routes will be targeted for all the bases, with Ha’il potentially gaining links to Dubai or Turkey, and the second hub prioritising services to Cairo. At present, Riyadh and Dammam are not served by Nesma’s Egyptian unit.

Nesma launched operations in July 2010 as an all-charter carrier focused on bringing European tourists to resorts by the Red Sea and Nile River. The airline subsequently evolved into an all-scheduled carrier serving Gulf destinations, adapting to the dearth of western tourists in Egypt following a slew of political and security crises over recent years.

Alongside its entry into the domestic Saudi market, Nesma is also evaluating services from Egypt to Kuwait, the UAE, Sudan and Bahrain. Lamloum says it will further restore charter operations once European demand recovers.

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