Saudi charter operator and FBO landlord PrivatAir Saudi Arabia (PASA) is banking on growth in business and general aviation in the kingdom in the next decade to drive its business model, managing director Mansour Alsharif told AIN at the Saudi Airshow in Riyadh in March.

“PASA is a Saudi organization,” he said. “It was established in 2011 and in 2012 got its [Part 135] AOC [air operator certificate]. The group has investments in the entire aviation supply chain, from air charter to training, maintenance, logistics, spare parts, and fuel. This helped drive synergies, and familiarity with regulation helped PASA become a reliable, mature VIP charter operator. We got our Part 121 special unscheduled AOC [in 2016] and that allows us to charter aircraft in Saudi Arabia. Only a handful of entities in the Kingdom have such a certificate. That's how we grew over the years and gained more experience.”

Alsharif said running parallel businesses in charter and FBO made sense. “Because we fly, we understand the operator's needs,” he said. “I would like to see a 50-50 split for diversification, but the two industries are different. The air charter side is more volatile, while the airport and FBO side is [steadier] because it's based on leases and traffic. [PASA’s] business is skewed towards airports.”

PASA’s other role is managing and overseeing private aviation terminal infrastructure at airports in Riyadh, Jeddah, and Dammam. “The private and general aviation markets are very promising,” he said.

“Our model is to be the landlord. Our job is to help increase private aviation traffic. We view their interest as our interest, but we don't do any ground handling at all. And as landlord, we take care of the building in terms of maintenance and of debottlenecking. Our job is to enlarge the pie.”

Alsharif said business aviation in Saudi Arabia had been through a tough three years, culminating in the anti-corruption drive that saw leading businessmen held in detention at a major Riyadh hotel.

“There was a drop in general [and] private aviation. It's not only because of the [anti-corruption drive]. Before that, there was a cut in government allowances. The restructuring program came in 2016, and it continued until mid-2017; spending decreased. When income decreases, private and general aviation is impacted quickly. In 2017, certain events took place that will never be repeated. This is now [behind] us, and in 2018 and 2019, the industry is growing. We think that growth will continue based on studies we did.”

Riyadh Growth

The studies project annual passenger growth of 3.9 percent at Riyadh through 2030. Today, the incumbent FBOs are Sky Prime, SPA, Jet Aviation, and NasJet-ExecuJet. PASA plans to add one more.

“This is partly due to the Kingdom's Vision 2030 allowing business to come to Saudi Arabia,” he said. “Many events, including investment, entertainment, and tourism, are taking place. In December we had a Formula One event. Air traffic movements are forecast to grow. That's driven by industry change and also by the facilities that we are offering.”

PASA has a number of maintenance hangars at Riyadh. “One of them involves investment starting out with C-Check, [with] provision for D-Check. We're talking to three international technical partners to move this project forward. We also plan a number of aircraft hangar areas to provide shading due to the hot weather. This long-awaited service will be introduced in 2019.

“We are also offering an improved and enlarged private aviation terminal. The expansion aims to increase its size to 11,200 square meters [120,556 square feet]. We have finished phase one, the government processing area. One of the most important projects there is to increase apron size from 90,000 to 220,000 square meters and from 24 aircraft stands to 83 stands. We have witnessed a huge increase in business jet movements, with about 15,000 ATMs in Riyadh. We think it could take one more FBO.

“The entire [project] will finish in June 2020. This includes enlargement of a brand-new terminal with six lounges. One will be for mass movements, basically for commercial use, but it's actually private aviation, or VVIP for commercial use. The service was needed because, as you know, when it’s a question of VVIP service, a VVIP lounge is required. We'll have six state-of-the-art lounges, to service the five FBOs.”

Jeddah FBOs

Jeddah, the cradle of aviation in the kingdom, houses two existing FBOs, with two more planned. “In Jeddah, we increased the government processing area by a factor of six,” he said. “Today, many trips that are general aviation are not channeled through the private aviation terminal; they land on the apron and then the authorities direct passengers to the commercial terminals. That's not a good experience for the passengers, and it's a revenue loss on the FBO side as well.”

By freeing up the apron and government processing areas, PASA has increased the entire capacity of the system. “We think 2019 will be the first year in Jeddah we start receiving VVIP Hajj and Umrah charters. The same number of VIP passengers will come to Jeddah, but we cannot process them in our terminals. So they will go to the commercial terminal. That's never been the case in the past at the private aviation terminal in Jeddah. This year could be a benchmark.”

Jeddah FBO operators today are Jet Aviation and Saudia Private Aviation. PASA plans to add two more FBOs, but Alsharif would not specify. “We have two important new names who will enter the Jeddah FBO market in 2019,” he said. “For reasons of confidentiality, I cannot disclose them.

“We did the pre-qualification. We reviewed a number of FBO players, up to I would say nine FBOs, over the last year, some of them international. Some were interested in flight support, but not ground handling, while others insisted on ground handling. We finished with two very large brand names that are serious and we think we will introduce them in 2019. We support them by offering dedicated areas in the terminals because the flight support people need to be close to the action.”

He hinted that new players would soon enter the kingdom. “We allocated areas for flight support. Also in Jeddah, there is an area today that wasn't there before. We will definitely give them support and allow them to work [there]. Our job is to create opportunity and give provision for other parties to be qualified. We are more than happy to welcome them and bring them to Saudi Arabia.”

Dammam GA

There are no general aviation facilities today at Dammam. “If you have a general aviation flight going to Dammam, the commercial airline ground handlers take care of that,” Alsharif said. “In 120 days [around mid-June], we will finish the first private aviation terminal at Dammam and we will introduce an FBO there.

“We have almost finished refurbishing the executive office building. [It will serve] executive passengers and VIP airliners. The FBO will be located within the existing terminal infrastructure. We are finishing the interior design, construction, and fit-out. It will be the first private aviation terminal in Dammam.”

Dammam is mostly driven by Aramco, one of the biggest players in Saudi Arabia. “We respect what they do for the aviation industry, but to date, we don't serve them,” he said. “They have their own facility.”

Medina Charter

Medina is regarded as Saudi Arabia’s fourth international airport. “Next to Riyadh, Medina is definitely driven by charter, because of the Holy Mosque there, and Hajj and Umrah,” he said. AIN understands that PASA could eventually look beyond its concession, which applies to facilities in Riyadh, Jeddah, and Dammam alone. “That could change," Alsharif said. "Today there is general aviation going to Medina. We do not have the honor of servicing that. It is serviced by the airport operator of Medina.”

New Projects

Alsharif said Saudi Arabia’s Vision 2030 was tailored for growth, infrastructure, investment, and job creation. There are three key new megaprojects on the west coast: Amaala, a medical resort project; luxury living scheme Neom; and the Red Sea Project, an offshore-island tourism development.

“We think all three will probably need airports with international access,” Alsharif said. “This could create a huge market. That has never happened in Saudi Arabia: people who want to fly directly to a medical resort or to enjoy the Red Sea, diving, and all of that.

“This will drive internal traffic between these three airports and Jeddah and Riyadh. We think these three airports [could] have huge prospects for private and general aviation. Other Saudi airports among the 27 officially listed have good prospects in commercial aviation, but from a general and private aviation perspective, we think these three, today, are well-positioned for growth.”

He said the Saudi Airshow in March was a boon to Saudi business aviation. “We supported it, by bringing our fleet. We engaged our clients and FBOs in formal and informal meetings. We discussed everything in the industry. We also talked to the operators themselves. The message that they want to convey is that the aviation industry in Saudi Arabia is strong, especially private aviation. It is strong, and it's flourishing. It's supported by scientific studies. We are committed to do our bit for the 2030 Vision.

“And you will see the numbers at the end of 2019, and how much traffic exceeded [that of] 2018.”