Saudi Private Jet Industry Stalls After Corruption Crackdown

Date: 09 January 2019 - 21:47

News ID: ۶۱۸۵۷

DUBAI (Reuters) – A crackdown on corruption in Saudi Arabia has severely dented the kingdom’s private jet industry in a sign of the impact the campaign has had on private enterprise and the wealthy elite.
Dozens of planes, owned by individuals and charter companies and worth hundreds of millions of dollars, are stranded at airports across the kingdom including Riyadh and Jeddah, four people familiar with the matter told Reuters.
Some were handed over to the state in settlements reached after the crackdown was launched in late 2017, when dozens of princes, businessmen and government officials were detained, they said.
Others belong to Saudis who either face travel bans or are reluctant to fly the planes because they are wary of displays of wealth that might be seen as taunting the government over the anti-corruption campaign, two of the sources said.
The government media office did not immediately respond to Reuters’ requests for comment on the impact of the anti-corruption drive on the private jet industry.
The crackdown’s impact on the business community and private enterprise, which are already reeling from low oil prices and weakened consumer confidence, has shattered investor confidence and contributed to a sense of uncertainty around the policies of Crown Prince Mohammed bin Salman.
The idle aircraft, which one of the sources estimated at up to about 70, include Bombardier jets, the sources said. There are also larger Airbus and Boeing aircraft that are more commonly associated with commercial airlines but are often used in the Middle East as private jets.
A Boeing 737 MAX or Airbus A320neo can cost up to $130 million, though the final cost depends on how the jet is fitted out with technology and amenities, including private bedrooms, meeting rooms, and even gym equipment.
Most of the detainees held at Riyadh’s Ritz-Carlton Hotel last November were released after being exonerated or reaching financial settlements with the government, which said it aims to seize more than $100 billion in total in either cash or assets.
It is unclear how the government would transfer ownership of the jets grounded across Saudi Arabia as many are owned through offshore firms or are mortgaged, two of the sources familiar with the matter said.