Thursday, October 26, 2017

Saudia targets religious and pilgrim business

Saudi Arabian Airlines wants to expand its religious and pilgrim business as the government continues to issue more visas.

“Saudia’s market share of pilgrimage traffic has great potential and is a priority for years to come,” Saudia CEO Jaan Albrecht told ATW in an exclusive interview in Jeddah.

“Thirty-three percent of Saudia’s business is labor traffic, like to India and Pakistan—the same share is religious traffic, and the remaining traffic is business travelers and tourism,” Albrecht said. He added the Saudi Arabian government issues 6 million visas per year for Hajj and Umrah pilgrimage traffic—which will rise to 15 million by 2020 and 30 million by 2030.

“The Hajj peak season is about 70 days, but what do you do with your infrastructure after the peak season ends? With the new terminal in Jeddah, available from 2018, this will change a lot as Saudia can offer high-quality hub and transfer business and increase the number of destinations, giving the religious traveler more nonstop opportunities,” Albrecht said.

Meanwhile, Saudia’s average aircraft capacity is increasing.

“We have phased out Embraer E170s and switched to larger Airbus A320s, which means a big jump in ASKs. We are also phasing out our Boeing 777-200s and replacing them with the larger variant 777-300s, meaning another jump in capacity,” he told ATW.

The SkyTeam member was also able to increase load factors by adding capacity. “Yields remain under pressure, particularly in this part of the world. However, we are getting more [premium] passengers and have been able to stabilize yields. Passengers are realizing our product is improving,” Albrecht said, adding the carrier is implementing a massive system-wide quality product initiative. “We have to aim high,” he said.

Saudia operates 143 passenger aircraft. Within two years, Saudia added 60 new aircraft, including Airbus A320s, A330s regional Boeing 787s and 777-300ERs. “Some of these aircraft are for replacement and some for growth. The average age of our fleet will be 3.75 years by the end of this year; by 2020, we will operate 200 aircraft,” Albrecht said.

(Kurt Hofmann - ATWOnline News)

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