Saudi Growth: Could Riyadh Replace Dubai As The Middle East"s Mega-Hub Airport?

Photo: Markus Mainka & Wulandari | Shutterstock

This year has seen the unveiling of some remarkable growth plans for Middle East aviation. The major airlines of the region will be receiving nearly 800 new aircraft over the next five years, and to accommodate this growth, airports are announcing major expansion plans as well.

Dubai has approved a massive expansion of Al Maktoum International Airport (DWC), which is expected to replace the already huge Dubai International Airport (DXB) by the decade's end. But not to be outdone, Saudi Arabia has big plans for the new 6-runway King Salman International Airport (RUH) in Riyadh, which could see it rapidly surpass other regional hubs in Doha and Abu Dhabi.

Riyadh vs. Dubai: The state of play today

Riyadh is currently served by King Khalid International Airport (RUH), which, although the larger airport, had less than half as many passengers and a quarter of the cargo that Dubai International had last year.

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King Khalid International Airport (RUH)	Dubai International Airport (DXB)
Size	87 sq miles \| 225 sq km	11 sq miles \| 28 sq km
Number of passengers (2023)	37 million	87 million
Amount of cargo (2023; tons)	440,000	1,800,000
Number of terminals	4	3
Number of runways	2	2

The difference lies in the airlines. Riyadh will be the home base of Riyadh Air. However, Dubai International has both Emirates and flydubai, with a combined 350 aircraft flying to nearly 300 destinations, not to mention a far larger number of international airlines that have DXB as a destination. Add to that Dubai's emergence as a tourist destination in its own right, and it is easy to see why it is pulling away from Riyadh as the Middle East mega-hub.

Competition heats up with massive growth plans

However, Saudi Arabia has big plans that could change this balance of power. Long dependent on oil revenues for most of its fiscal revenue, the Saudi Vision 2030 program aims to diversify the Kingdom's economy and includes high-profile projects such as:

NEOM: A USD 500 billion urban development at the northern tip of the Red Sea.
Red Sea Global: A USD 24 billion tourism program for Red Sea destinations.
Diriyah: The USD 68 billion restoration of the World Heritage Site of At-Turaif.
Qiddiya: A USD 10 billion entertainment and tourism megaproject in Riyadh.
Roshn: Housing developments aimed at increasing Saudi home ownership.

The big development plans for Riyadh

The Saudi Vision 2030 states that Saudi Arabia will become "an investment powerhouse and the hub connecting three continents." To deliver on this, the new King Salman International Airport (no IATA code yet) will be constructed over the current facility at RUH. The new 'aerotropolis' will include expanding existing terminals, constructing new terminals, constructing six parallel runways, and creating 5 square miles of retail outlets and residential and recreational facilities.

The new airport aims to accommodate up to 120 million passengers and 2 million tons of cargo by 2030, growing to 185 million and 3.5 million tons by 2050. Mammen Tharakan, VP of investment & partnership for the airport, describes the project as follows:

"Saudi Arabia's strategic location at the crossroads of Europe, Asia, and Africa makes King Salman Airport a critical hub for air traffic between East and West. We aim to become the key transit point for passengers and cargo moving between major international markets, reducing travel time and logistical challenges. This increased connectivity will bolster non-oil sectors such as tourism, trade, and services, contributing to the diversification of Saudi Arabia's economy and making Saudi Arabia a key player in global supply chains."

Dubai has some plans of its own

But while Riyadh may be looking to become the mega-hub of the Middle East, Dubai currently holds that title and plans to keep it. Earlier this year, Dubai announced a USD 35 billion expansion of Dubai World Central, intending to ultimately replace Dubai International, with Emirates and flydubai moving over by the decade's end

Because Dubai International is constrained by development on all sides, but Dubai World Central has much more available land, the plans call for it to ultimately be five times the size of the current DXB. It will have five parallel runways and 400 gates, and after all construction phases are complete, it will have a capacity for 260 million passengers and 12 million tons of cargo annually. This is considerably more than the plans for King Salman International Airport.

How the airlines will fuel this growth

So, at face value, Dubai is set to make the necessary investments to sustain its leadership status as the mega-hub of the Middle East. However, a closer examination of regional airline investments suggests that the momentum might be swinging. Based on data from OAG, the airlines based in Dubai (Emirates and flydubai) and Saudi Arabia (Saudia, Riyadh Air, Flynas, and flyadeal) are both set to receive approximately 300 new aircraft over the next five years. But there is a notable difference between the two.

Whereas a significant portion of the Dubai-based orders are to replace existing aircraft, the majority of the Saudi orders are net expansions. For example, Flynas has an order book of 280 aircraft with Airbus over the next decade and is set to increase its fleet by over 100 aircraft by 2030.

The real tipping point will be Riyadh Air: It has yet to fly a commercial service and already has over 130 new aircraft on order. It is also evaluating an additional order for A350-1000 or B777X aircraft, so this number will only grow further. It is the success of Riyadh Air that will determine the future growth of King Salman International Airport, which is not lost Tharakan:

"Our alliance with Riyadh Air goes beyond cooperation; it's a strategic partnership to reshape the aviation sector across the Middle East. Riyadh Air will put a world-class airline at the center of our operations, driving traffic through our terminals and enhancing Riyadh's position on the global aviation map."

How the balance of power might change

Riyadh will be playing a game of catchup with Dubai for at least another decade, likely longer. But it does have some significant advantages in its favor:

Deep pockets: This is an obvious factor, but it needs to be stated anyway. While the UAE does not lack wealth, it is vastly overshadowed by the Kingdom to the west. At a basic level, Saudi Arabia has the finances to compete, attain parity, and surpass its neighbor.
Infrastructure boom: As the Kingdom pours trillions of dollars into infrastructure projects nationwide, inbound and domestic travel will undoubtedly grow strongly. Riyadh will benefit from being the primary connecting hub.
Domestic travel market: Riyadh has something Dubai will never have - the ability to be the super-connector in a fast-growing domestic market, with ‘guaranteed’ demand due to extensive and growing religious travel.
Room for growth: Dubai has over 100 foreign airlines flying to it, while Riyadh has barely 50. OAG estimates that some 160 non-domiciled carriers fly to the Middle East, so there is plenty of room for growth for Riyadh and growing incentives for international airlines.
Demographics: Saudi Arabia has a far younger population, with 70% under the age of 35, and that, along with an increasingly urbanized (and wealthier) workforce, will drive higher growth in travel demand.

But if Riyadh is going to catch up and even overtake Dubai, it will undoubtedly take some time. Dubai has a first-mover advantage and is far more socially relaxed and welcoming to outsiders. The Kingdom requires a lot more socio-political transformation to be competitive as a global commercial and tourist destination.

Furthermore, as many will point out, Dubai's location as a vibrant coastal city on the Persian Gulf has huge advantages for tourism over a staid city in the middle of the desert. But Riyadh will look to the world's most developed aviation sector for signs of hope, where two of the most prominent tourist destinations were built in a desert and a swamp, and an otherwise unremarkable inland city became the busiest airport hub in the world. So keep your eyes on Riyadh as it looks to spend its way to the top because it might well achieve it.