UPDATE 1-New Saudi airline in $2 bln deal for Bombardier planes

Thu Jan 16, 2014 6:19am EST
 
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By Rania El Gamal

MANAMA Jan 16 (Reuters) - Saudi Gulf Airlines, a new carrier born of the deregulation of Saudi Arabia's aviation market, has signed a $2 billion deal with Canada's Bombardier Inc to buy 16 CSeries jets with options for 10 more, the airline's owner said on Thursday.

The deal is a boost for Bombardier, which has so far seen slow orders for the CSeries after several months of development delays, with potential customers waiting for flight test data to confirm fuel and cost saving claims.

Delivery of the CS300 jets, which seat between 130 and 160 passengers, is expected between the end of 2015 and the start of 2016, said Samer al-Magali, president of the Abdel Hadi al-Qahtani group.

Dammam-based Saudi Gulf is expected to start operating later this year or next year, Magali told reporters at the Bahrain International Airshow, saying the $2 billion referred to the list price for the planes and options.

The group is ready to buy or lease around six other planes until the CSeries jets are delivered, he added.

"Saudi Gulf will be launched once we have the technical licence from the civil aviation authority," said Magali, a former chief executive of Bahrain's national carrier Gulf Air .

Saudi Arabia started opening up its aviation market in 2012 by awarding additional carrier licences. Population growth and rapidly rising incomes mean there is considerable room for expansion, analysts believe.   Continued...