NAS unveils plans to launch Saudi Arabia's first low cost carrier

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The company plans to launch the airline before summer 2006.

The airline, yet to be named, will also be the first privately owned domestic carrier to be established in the Kingdom, and the only carrier other than Saudi Arabian Airlines licensed to provide scheduled domestic services.

This announcement comes only four months after the company made two other revelations that continue to permanently change the commercial aviation landscape in Saudi Arabia: that it had been awarded the first private Part 121 Air Carrier Certificate ever to be issued by the Presidency of Civil Aviation in Saudi Arabia; and that it had simultaneously launched its revolutionary Al Khayala VIP Shuttle Service. These announcements, made in July this year, came almost 15 months after the Supreme Economic Council of Saudi Arabia endorsed a recommendation that the Kingdom open up the domestic aviation market to national companies.

Speaking to an audience of local, regional and international media at the company's press conference during the 2005 Dubai Air Show, Mohammed Al Zeer, President and CEO of NAS, stressed the significant nature of what the company had been able to accomplish in recent months.

'NAS has undertaken a mammoth task in obtaining its full Air Carrier certification and breaking down barriers which had existed under a monopoly for 60 years in the Kingdom',

Al Zeer stated. 'These accomplishments, including the launching of both the Al Khayala Service and this new airline, are a testament to the experience and expertise of every member of the NAS team, and a result of their hard work and dedication over the past 2 years. The writing of this new chapter in Middle East aviation also, of course, would not have been possible without the unwavering support we have received over the years from our Board of Directors and Shareholders, who have believed in us since the beginning.'

Al Zeer pointed out that this announcement is the culmination of literally years of study and analysis into such a service. 'We conducted extensive feasibility and market studies before including this service in our strategic plan, have met with all of the most successful low cost operators in the world to fully understand the concept, and have employed top international consultants to review our results and our plans' he stated. 'We intend to apply the same unwavering, internationally recognized standards of safety and reliability that we have implemented in all of our business lines throughout our history'.

Al Zeer also indicated that the Saudi market is ripe for the introduction of this type of service - a successful business model gaining clear acceptance throughout the world - since the country has by far the largest domestic air travel demand in the region and is uniquely suited to this type of model. 'This new service will have a significant impact on Saudi Arabia in many areas, increasing the number of flights operating throughout the Kingdom, providing additional options for domestic travelers, generating new growth in the air travel market, creating new jobs for Saudi nationals, increasing tourism and generally positively impacting the Saudi economy' he stated.

This is the latest in a series of announcements the company has made in recent years, dating back to the Dubai Air Show in 2003 when they announced their intention to introduce a VIP Shuttle Service to the region. 'At NAS, nothing we do is traditional' said Al Zeer. 'From the first day this company was established, we understood that this market is unique and that we would need to offer unique, non-traditional solutions to our customers in order to be successful. The low cost airline concept is one which has revolutionized the commercial aviation market, and is a non-traditional product which we believe fits nicely into our operation and our culture'.

Mr. Al Zeer also stated that his company will soon announce details of the deal which is being finalized for the acquisition of a fleet of aircraft to be employed in its new low cost service. Commenting on the size and make of the new fleet, Al Zeer said that his company is currently finalizing a transaction with an international manufacturer and said that the aircraft model had been carefully selected in order to satisfy the unique requirements of Saudi and regional travelers.

Al Zeer also announced that the acquisition of the new fleet will be financed by an international lending institution and likely backed by Export Credit Agencies, as has been the trend for the company in recent years, reflecting the quality of the company's business model and the ongoing confidence international governments and the lending community have in NAS. 'We have established a financing structure that we are comfortable with, that provides us the freedom and cost control we require in order to properly serve our customers, so we will likely apply it in this case as well' Al Zeer said.

Al Zeer explained that the company's new low cost solution, which will operate as an additional Strategic Business Unit within NAS, will commence its operation prior to summer 2006, and will initially service domestic routes in Saudi Arabia, before expanding into high demand destinations in the Gulf and the Middle East at a later stage.

Regarding pricing of the new service, Al Zeer added that the company will ultimately take into consideration a number of variables, such as the chosen destinations, the date of travel, the capacity and the mode of payment, among others. 'Prices of seats will vary depending on many factors,' said Al Zeer and explained that typical low cost airline tiered pricing, including advance booking and on line payments, will guarantee a more economical seat price than that last minute reservations. 'Like any low cost airline, we will encourage travelers to plan their trips ahead of time, so that they are able to reap the financial benefits of the new service,' he noted.

This new low cost airline comes as yet another addition to the company's ever expanding service portfolio, reflecting the diversification strategy NAS has been employing for many years now. This year alone the company has introduced its Al Khayala service and has added medical evacuation services expertise to its portfolio through its launching of such services for gas exploration companies working in the Saudi Arabian Empty Quarter.

Since its establishment in 1999, NAS has provided a growing range of services to the private aviation sector, which had historically been drastically underserved. The company currently provides a comprehensive service set in addition to Al Khayala, including its revolutionary NetJets Middle East Fractional Aircraft Ownership and Leasing Program, aircraft charter services, aircraft management solutions, operation support and project management solutions and a hybrid product which combines the benefits of each of these services into one unique package for Middle East customers.

NAS operates and manages the largest and fastest growing fleet of private aircraft in the Middle East Region and one of the twenty largest worldwide. The company currently has a total of 28 aircraft of different types in its stable, including the largest fleet in the world of privately configured Airbus aircraft, along with Boeing, Gulfstream, Dassault and Raytheon models, and even Twin Otter aircraft employed in its medical evacuation service. With the orders announced recently, plus the introduction of this new airline, the company expects its fleet to grow to over 50 aircraft in the coming two years.

NAS offers the unique proposition to Middle East customers of unparalleled international service through a truly local company, and prides itself on being able to offer flexible, unique, non-traditional total solutions to all private aircraft users, regardless of their requirements.