ARLINGTON, WASHINGTON — Boeing Eyes Second Major Deal in Saudi Arabia with Prospective Sale to Riyadh Air.
Boeing is negotiating to secure its second major contract in Saudi Arabia this year, eyeing a potential sale of at least 150 737 Max jetliners to startup airline Riyadh Air, according to sources who spoke to the American news agency Bloomberg.
Riyadh Air, which is owned by Saudi Arabia's sovereign wealth fund, is looking to purchase a total of 300 to 400 single-aisle aircraft, including options, as disclosed by the sources who requested anonymity due to the private nature of the talks. The discussions are intricate, with the deal's timing and structure yet to be finalized. Airbus SE might also secure a portion of the order, the sources cautioned.
Boeing seeks to capitalize on the limited availability of delivery slots for Airbus's A321neo jets before 2029, the sources explained. The negotiations are ongoing, and there could be an announcement at the Paris Air Show in mid-June, though no formal decision has been made, they added.
Spokespersons for Boeing, Riyadh Air, and the Saudi Public Investment Fund declined to comment on the matter.
A second significant deal would bolster Boeing's standing in the Gulf market, which shows considerable growth potential. Crown Prince Mohammed Bin Salman, intent on boosting tourism in the kingdom, is establishing a competitor to regional titans Emirates and Qatar Airways. American and Saudi officials have endeavored to mend relations between the two countries, strained over issues including oil policy.
The previous contract entailed the purchase of Boeing's larger 787 Dreamliners to facilitate long-range flights for Riyadh Air and the existing national airline, Saudia.
Given the current $53 million market price for a Max 8, an order of 150 jets could be worth approximately $8 billion, as per market-value estimates compiled by consultancy firm Ascend by Cirium. Customers usually receive substantial discounts for large-scale deals.
Launched officially in March, Riyadh Air is a facet of Bin Salman's plan to diversify Saudi Arabia's economy away from oil reliance. He harbors ambitions of transforming Riyadh into a major business hub and vying with larger Gulf airlines for international transit traffic. Saudia primarily serves Jeddah and the Hajj pilgrimage market at present.
Under the terms of the March agreement, Riyadh Air is slated to receive 39 787-9 aircraft, with an option for 33 more. Managed by former Etihad Aviation Group leader Tony Douglas, the airline aims to connect over 100 destinations worldwide by 2030.
