Airbus in £10bn talks to lock in Saudi Arabia for mega order of 40 A350 planes
Saudi Arabia is reportedly in talks with EU plane manufacturer Airbus for the purchase of around 40 A350.
Industry sources told Reuters the order would stand at $12bn (£10.6bn) and could be announced as early as this week.
The Saudi government is in fact hosting the Future Investment Initiative, an international investment forum run by the country’s wealth fund PIF, from Tuesday to Thursday.
An Airbus spokesperson told City PM the company would not feed speculation.
“We are always in talks with existing and potential customers and the details of talks which may or may not be happening remain confidential in any case,” they said.
It’s still unclear whether Boeing will also get a piece of the billion-dollar pie, as the wealth fund has reportedly been in negotiations also with the US plane maker.
City PM has approached the PIF while Boeing declined to comment.
The potential deal is seen as part of the country’s effort to launch a new airline, RIA, to rival neighbouring countries such as Qatar and the UAE.
Aviation analyst Alex Macheras told City PM many continue to remain sceptical about the project’s feasibility.
“Several senior aviation industry executives have turned down opportunities with ‘RIA’ – one calling it ‘an idea without substance’,” he said.
It could also have political ramifications, especially as the relationship between Washington and Riyadh seems to have soured over the past few weeks.
President Joe Biden announced on 11 October there would be “consequences” for the relationship between the US and Saudi Arabia following OPEC+’s decision to cut oil production by 2 million barrels a day.
The organisation – which includes Saudi Arabia in addition to other 12 oil producers – said the decision served market stability.