With revenues to exceed $22 billion and 6,000 jobs by 2030
– Partnership to provide sustainment services for fixed- and rotary-wing military aircraft of the Kingdom’s defense services
– New partnership will help to achieve the National Transformation Program goals and embrace Vision 2030
– Investment value to reach $450 million in facilities and equipment inside the Kingdom
In line with Saudi Arabia’s Vision 2030 and following the announcement of HRH Prince Mohammed bin Salman bin Abdulaziz, Crown Prince, Deputy Chairman of the Council of Ministers and Minster of Defense, Saudi Arabian Military Industries (SAMI) and Boeing (NYSE: BA) today signed a Memorandum of Agreement (MoA) to develop a new joint venture (JV). The signing ceremony came in conjunction with HRH Prince Mohammed bin Salman’s visit to Seattle, which included an official visit and tour of Boeing’s aircraft manufacturing facilities. The agreement was signed by H.E. Ahmed Al-Khateeb, Chairman of SAMI, and Dennis Muilenburg, Chairman, President, and CEO of Boeing, at Boeing’s headquarters in Seattle.
Commenting on this important milestone, H.E. Ahmed Al-Khateeb, Chairman of SAMI, said, “Boeing has a long-standing commitment to Saudi Arabia, and is extremely keen on expanding its footprint in the country. Inspired by the vision of HRH Prince Mohammed bin Salman, SAMI, on the other hand, is exploring all collaborative opportunities to build a strong autonomous military industries ecosystem in the Kingdom.”
The joint venture agreement will provide sustainment services for fixed- and rotary-wing military aircraft of the Kingdom’s defense services, and will be the sole provider of these services for all military aviation platforms of the KSA military fleet. The JV will also increase the localization of Maintenance, Repair and Overhaul services (MRO), strengthening the Kingdom’s defense capabilities and enhancing its deterrent potential. The agreement will transfer technology to install weaponry on these aircraft as well as localize the supply chain for spare parts in the Kingdom.
“We deeply appreciate the trust that the Kingdom of Saudi Arabia in general, and HRH Prince Mohammed bin Salman personally, are placing in Boeing to help deliver Vision 2030 with this new joint venture,” said Dennis Muilenburg, Boeing Chairman, President, and CEO. “Our relationship with the Kingdom dates back more than 70 years, and we look forward to continuing our successful partnership in support of the Kingdom’s national security and aerospace industry needs.”
The MoA will further solidify the enduring relationship between Boeing and Saudi Arabia and result in the development of local research, design, engineering, manufacturing, and MRO capabilities. The JV will continuously improve performance and growth, upgrade the readiness of the Saudi military fleet, enhance maintenance capabilities, and reduce support costs throughout the fleet’s life. In addition, the agreement will create 6,000 jobs and training opportunities for Saudi youth, support local development, and augment the participation of Saudi nationals in the industry, contributing towards the objectives of the Kingdom’s comprehensive Vision 2030 plan.
Muilenburg added, “With this local capability dedicated to sustaining all U.S.-made defense platforms, we can better serve our customers and support the Kingdom’s goals of localization and economic growth.”
Dr. Andreas Schwer, CEO of SAMI, added, “The significance of the MoA, which is signed today, will enable SAMI and Boeing to play a key role in leading and laying the foundational framework for Saudi’s defense sector industrialization, in line with the goals of the Kingdom’s National Transformation Program and Vision 2030. In addition to local sustainment capabilities, the inevitable partnership between the two companies could explore the creation of intellectual property as well.”
The JV will provide a foundation for future platform sales and for expanding Boeing’s presence in the Kingdom to support market growth in both the commercial and defense sectors.
Boeing’s partnership with Saudi Arabia dates back more than 70 years and is growing from strength to strength. It began on February 14, 1945, when U.S. President Franklin D. Roosevelt presented a twin-engine Dakota DC-3 airplane (manufactured by Boeing’s heritage company Douglas Aircraft) to King Abdulaziz Al Saud: this event also marked the birth of commercial air travel in the Kingdom. Once the MoA is operational, the joint venture will open a new chapter of collaboration and innovation in this longstanding partnership.