With the entry of new airlines, a tough competition is expected in Saudi Arabian domestic and international flight operations.
Qatar Airways and Gulf Air and its associates have been selected as the new airline companies to operate domestic and international services to and from Saudi Arabia. This decision will be implemented within the next six months.
Currently there are only two airlines operating in the Kingdom. They are the state-owned Saudi Arabian Airlines (Saudia ) and low-cost carrier National Air Services (NAS). The country's third carrier, Sama Airlines, ceased operation last year as talks with the government failed to yield a commitment to support the company. Nesma Airlines also operates flights from Saudi cities to many popular destinations in Egypt, like Sharm El-Sheikh, Hurghada, Marsa Alam, Luxor and Alexandria.
Tourism experts welcomed the new decision aiming to see a change in the services in Saudi aviation.
Faisal Al-Turki, vice president of Nesma Airlines, said that such a decision is very healthy to promote the aviation sector in Saudi Arabia and boost the standards in domestic flights.
"Qatar Airways and Gulf Air have presented a very good offer, which is why they got the licenses. I expect the new airlines to attract more passengers than the current airlines like Saudia . Saudia will still give a special offer to students, and workers in the military sector, so these passengers might keep traveling with Saudia to enjoy these special offers," he said.
Nesma Airlines was one of the companies that competed in the selection process and ranked third.
"We tried our best to start operating domestic flights, but we were unlucky in getting the licenses. We will keep trying by presenting better services. To boost our service and expand it in Saudi Arabia, we will start operating flights from Ahsa, Jouf, and Baha to several cities in Egypt," he said.
Bader Al-Hokair, CEO at Al-Hokair Group, said that the Saudi market is big enough to receive more aviation companies.
"This step will increase the number of flights and decrease chances of overcrowding, especially in the pilgrimage seasons and summer," he said.
"I don't think that passengers will abandon the current available airlines, as the market is too big and more airlines can join."
Al-Hokair expects domestic tourism will increase, especially when passengers have been suffering from overcrowded domestic flights for a long time.
Mohammed Shams, economist, said the entrance of new airlines would fuel the competition, raise the present standard and reduce prices.
"We are expecting a tough competition that will create a new aviation market with special standards.
For a long time, Saudia monopolized the Saudi aviation market, which led to a stable service and fixed prices. This is unhealthy for the Saudi tourism or local economy," he said.
Shams added: "New laws will emerge in the Saudi aviation market due the entrance of new airlines."
He believed Saudia would have to rethink its service levels, and reduce its prices.
"I know that the Council of Ministers imposes the prices, but Saudia will notice a decrease in the rate of passengers, which is why they will be forced to reduce the prices. In Europe there was an airline that dominated the market. When new airlines entered the European market, the company collapsed," he said.
Shams would expect more tourism agencies to join the Saudi market. "We might see new GCC travel agencies offer special services. Travel agencies will also present new packages with special prices, which will definitely activate the tourism sector in Saudi Arabia," he said.