I may grumbled quite a few !#@#@%$#$ words that day on SAMA (though I was fully aware this was a low cost airline) but at no time had I wished that the airline to go bust. 3 years of average operations, one bad winter and a USD 266 Mn loss really does not count as good enough reasons for shutting down an airline, Do they? I always thought it was fashionable globally across the airline industry to make losses (and in some cases for decades over) until the stock prices becomes junk.
What is surprising is that this airline has/ had some serious backers in investors like Olayan Group, SISCO etc. Questions that remain unanswered at the time of blogging
i) Why had SAMA not listed after 2-3 years of operations?
ii) A low cost airline going should ideally not be going bust
iii) How did they rack up USD 266 Mn in losses, I mean this was a 6 aircraft airline
iv) Why didnt any PE investor/ investors come on board and give a lifeline or facelift
In Saudi Arabia, this is the third local Saudi airline after Saudia and NAS. What remains is NAS and Saudia. Are we to assume that in a country of 20 Mn+ population, there is a market size for local air travel which can be catered by two airlines? I dont believe it.
I know I'm missing something in between the lines of this SAMA airlines going bust news...eish I couild pin it down...I have this feeling we'll be seeing SAMA airlines with a new name and new management come out in the market soon..what do you say?
