Saudia Group has signed a preliminary agreement with Saudi Export-Import Bank and Crédit Agricole CIB to arrange financing for new Airbus aircraft, at a time when the Saudi aviation group is both receiving jets from existing orders and considering another major fleet purchase.
The memorandum of understanding was signed in Paris during the French-Saudi Investment Roundtable on August 25. Under the proposed structure, Crédit Agricole CIB would act as financier and arranger, while Saudi EXIM would provide insurance coverage against credit risks associated with the transactions.
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Saudia said the financing would be aligned with aircraft delivery schedules as the group expands and modernizes its fleet. It did not identify specific aircraft or disclose the potential value of the financing.
There is already a substantial Airbus backlog that could make use of the arrangement.
In May 2024, Saudia Group placed an order for 105 A320neo-family aircraft, comprising 12 A320neos and 93 A321neos. Of those, 54 A321neos were allocated to Saudia, while low-cost subsidiary flyadeal was assigned 12 A320neos and 39 A321neos.
That transaction brought the group’s total Airbus orderbook at the time to 144 aircraft. Deliveries from the 105-aircraft order were scheduled to begin in 2026 and continue through 2032, creating a significant long-term financing requirement.
The new agreement is therefore not necessarily an indication that another Airbus order is imminent. Its reference to financing aircraft according to delivery schedules is consistent with the large number of jets that Saudia Group has already committed to acquire.
Future orders also covered
The scope of the agreement, however, is not limited to aircraft already ordered. The parties also intend to explore additional financing transactions associated with future aircraft orders and fleet development programs.
That provision is noteworthy because Saudia has been evaluating another large aircraft acquisition.
Bloomberg reported in February that the Saudi flag carrier was in discussions with both Airbus and Boeing over a potential order for at least 150 aircraft. The talks reportedly covered narrowbody and widebody passenger aircraft as well as freighters, with no final allocation between the two manufacturers disclosed.
Saudia Group is undergoing rapid expansion as Saudi Arabia invests heavily in aviation and tourism. Its plans extend beyond the flag carrier itself, with flyadeal also growing its fleet and network.
The group has major commitments with both Western manufacturers. In addition to its Airbus narrowbody backlog, Saudia has Boeing 787s awaiting delivery, while Saudia Cargo announced an agreement in July for four new Boeing 777 freighters.
The Crédit Agricole and Saudi EXIM arrangement could consequently serve two purposes. It provides a financing framework for Airbus aircraft already scheduled to arrive over the coming years, while leaving the same structure available if Saudia Group places additional orders with the European manufacturer.
