Gulf Air, Qatar Airways to launch domestic flights in Saudi Arabia
(MENAFN) Saudi General Authority of Civil Aviation (GACA) announced that by the end of 2013, both Bahrain's Gulf Air and Qatar Airways will launch domestic flights in the Kingdom, reported Arabian Business.
The commencement of operations will help meet growing demand for domestic air travel in the biggest Arab economy.
At the current time, national carrier Saudi Airlines and budget carrier National Air Services (NAS) are the only airlines that provide domestic flights in Saudi Arabia.
It is worth noting that the number of passengers passing though the country's 27 airports exceeded 54 million in 2012, according to GACA
This is one bit of business logic I don't quite understand.
In this example, two airlines are excited to enter an unprofitable, money-losing market. The thinking seems to be that if this is a loss-making market for local airlines, somehow the entry of two money-losing foreign airlines will make things better, an unfortunate use of economies of scale.