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Saudi Arabia launched its second flag carrier, Riyadh Air, on Wednesday, moving ahead with a key economic diversification project despite uncertainty linked to the Iran war, delivery delays at Boeing and stiff competition from established Gulf airlines.
A London-bound Boeing 787 Dreamliner in the airline's white and lavender livery departed Riyadh on its inaugural commercial flight, marking the operational debut of the kingdom's second state-owned carrier after Saudia.
Founded in March 2023, Riyadh Air was initially expected to launch services in early 2025, but Boeing delivery delays repeatedly pushed back the timeline after the carrier was informed that only about half of the Boeing 787 Dreamliners it had expected to receive that year would arrive on schedule.
The carrier's debut comes as Gulf economies navigate heightened uncertainty amid the ongoing regional conflict that erupted after joint U.S.-Israeli strikes on Iran in late February, casting a shadow over the outlook for one of the world's busiest travel and tourism regions amid repeated airspace closures and elevated security risks.
Rising operational costs linked to tightening jet fuel supplies, as shipping traffic through the Strait of Hormuz remains largely disrupted, continue to weigh on the aviation sector globally, prompting the International Air Transport Association (IATA) to nearly halve its 2026 industry profit forecast to $23 billion from a previous projection of about $41 billion, down from $45 billion in 2025.
The airline is owned by Saudi Arabia's Public Investment Fund (PIF), the kingdom's sovereign wealth fund and the main vehicle behind Crown Prince Mohammed bin Salman's Vision 2030 economic transformation program, which aims to reduce the kingdom's reliance on oil revenues and transform Riyadh into a global aviation and business hub.
"We want to bring glamour, we want to bring refinement, we want to bring grace back," Chief Executive Officer Tony Douglas told AFP before the launch. He acknowledged that building a new airline involved both progress and setbacks but described the first commercial flight as a major milestone after four years of work.
The airline has placed orders for 132 Boeing 787 Dreamliners and last year signed an agreement to purchase 25 Airbus A350-1000 aircraft, with options for as many as 50 additional jets. "Our ambition is to be able to connect to over 100 international cities over the next five years," Douglas said.
At a ceremony celebrating the delivery of the airline's first aircraft, PIF Governor and Riyadh Air Chairman Yasir Al-Rumayyan described the launch as "a historic moment for the nation" and projected that the company would create 200,000 direct and indirect jobs.
Saudi Arabia is simultaneously investing heavily in aviation infrastructure to support its expansion plans. Saudi Arabia is also developing King Salman International Airport in Riyadh, which is expected to handle 120 million passengers annually by 2030, more than double the current capacity of King Khalid International Airport.
The kingdom aims to increase annual air traffic to 330 million passengers by the end of the decade as it prepares to host the 2030 World Expo and the 2034 FIFA World Cup while continuing to welcome millions of Muslim pilgrims to Mecca every year.
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