Capital A plans major aviation and logistics expansion to Saudi Arabia
PETALING JAYA: Capital A Bhd today announced plans to significantly expand into Saudi Arabia, marking a pivotal step in the group's Middle East growth strategy.
The multifaceted initiative will begin with AirAsia introducing new routes to Riyadh and Dammam, while increasing flight frequencies to Jeddah from Kuala Lumpur.
The group is also studying new connections from Bangkok, Thailand, and Jakarta, Indonesia, to Riyadh, as part of its wider ambition to enhance Middle East connectivity across the Asean region.
The expansion extends well beyond airline operations, as Capital A plans to introduce its entire business ecosystem to the kingdom, including Teleport – Capital A's rapidly growing logistics arm; Asia Digital Engineering (ADE) – providing comprehensive aircraft maintenance and engineering services; and AirAsia MOVE – the digital travel platform offering seamless end-to-end travel booking solutions
The announcement follows high-level discussions between Capital A's senior leadership team, including CEO Tan Sri Tony Fernandes and AirAsia Thailand CEO Tassapon Bijleveld and officials from the Saudi Ministry of Investment, General Authority of Civil Aviation and the Ministry of Transport.
The meetings explored strategic partnerships across airline connectivity, Red Sea tourism development initiatives and potential collaborations in logistics and aircraft engineering services.
Fernandes said: 'I am absolutely blown away by what's happening in Saudi Arabia – the cultural shift, the transformation in people's lives and the sheer scale of ambition is truly mind-blowing. But, more importantly, it's the motivation and mindset of the Saudi people that moved me. There's a real drive to build something big, especially the breathtaking Red Sea development, which I must say is one of the most ambitious tourism and infrastructure projects in the world. The scale of it is truly inspiring, and that energy is infectious.'
He added, 'We believe the new Riyadh route is projected to serve close to one million two-way passengers by 2026 and more than seven million by 2030, reflecting strong demand for increased connectivity between Asean and the Gulf region. We have so many projects we're excited to embark on from logistics to aircraft engineering; we're ready to grow with our brothers and sisters in Saudi Arabia.'
As part of the group's logistics focus, Teleport aims to explore working with Saudi logistics hubs and free trade zones to establish efficient cargo corridors between Asean and the Middle East, enabling faster, cost-effective movement of goods including e-commerce. With AirAsia's extensive belly cargo capacity and network reach, the partnership could help position Saudi Arabia as a key regional transshipment point for goods moving between Asia, Europe and Africa - supporting the kingdom's Vision 2030 goals of becoming a global logistics hub.
Meanwhile, ADE will explore opportunities to collaborate with Saudi aviation stakeholders to support the kingdom's fast-growing aircraft maintenance, repair and overhaul sector. This may include setting up line maintenance facilities at key Saudi airports, training and upskilling local talent in aviation engineering, and sharing best practices in cost-efficient, high-quality MRO services. With the exponential growth of airlines in the region, ADE aims to contribute to building a robust and self-sustaining aviation support ecosystem in Saudi Arabia.
Saudi Arabia now ranks as a top priority market for Capital A, following its rapid expansion in India and China. With Vision 2030 transforming the Kingdom into a global tourism and logistics hub, Capital A's multi-vertical model is uniquely positioned to contribute meaningfully to its growth trajectory.
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