Boeing, Airbus working with Saudi Arabia on metals for planes

Saudi Arabia said it’s working with top airplane makers Boeing and Airbus to get its aluminum and titanium approved for use in their planes as part of a push to get more manufacturing done inside the kingdom.

Achieving certification would potentially help the jet manufacturers overcome supply hurdles, including difficulties securing some raw materials. Saudi Arabia is also discussing making more aircraft components locally, according to the Saudi General Authority of Civil Aviation.

“Boeing, Airbus and Embraer are all showing interest in setting up long-term facilities for certain components in the kingdom,” Abdulaziz Al-Duailej, president of the organization known as GACA, said in an interview ahead of the Future Aviation Forum in Riyadh, which started on Monday.

Saudi Arabia is working on becoming a new center for metals and mining as it looks for ways to diversify its economy away from oil. The talks with aviation giants to become part of their metals procurement comes at a time when the kingdom is set to be a major source of fresh airplane orders. Crown Prince Mohammed bin Salman has ambitions to build out the country’s transportation industry, including through an overhaul of its aviation sector and the establishment of new airlines.

Flagship carrier Saudia announced today that it has ordered 105 narrowbody jets from Airbus — the largest in the airline’s 80-year history. It wanted even more planes but wasn’t able to secure additional delivery slots from Airbus before 2032.

Saudia ordered dozens of Boeing planes last year, as did Riyadh Air, the new airline that’s in the process of being launched by Saudi Arabia’s sovereign wealth fund.

Boeing signed a memorandum of understanding last year to explore the development of aviation-grade titanium in Saudi Arabia with local conglomerate Tasnee. The company produces about 10% of the world’s titanium sponge, which is a crucial material for the aviation industry, according to a statement.

GACA’s Al-Duailej sees Boeing holding its position as the leading manufacturer in the aviation space, even as the company grapples with the fallout from its worst crisis in years. 

Saudi Arabia aims to attract $100 billion in investment to the aviation sector by 2030, mainly driven by spending from Saudi Arabia’s sovereign wealth fund, Al-Duailej said. He estimates about half of that will be spent on airports and infrastructure, while the rest goes to aircraft and other activities.

GACA plans to privatize its airports by 2030, with Abha International Airport in the southern part of the kingdom slated to be next in line. Interested parties include global operators, contractors and foreign asset managers. –BLOOMBERG