Saudi Arabia's Localisation Efforts In The Automotive Industry Gain Momentum With Hyundai Partnership

Saudi Arabia is advancing rapidly to establish a local automotive industry, according to Minister of Industry and Mineral Resources Bandar Alkhorayef. This initiative aims to boost the national economy and enhance global competitiveness, aligning with Saudi Vision 2030. Alkhorayef spoke at the Hyundai plant's groundbreaking ceremony at King Salman Automotive Cluster in Jeddah.

The Hyundai plant is part of a strategic partnership between the Public Investment Fund (PIF) and Hyundai Motor Company. This collaboration supports the localization of the automotive sector and promotes economic diversification in Saudi Arabia. The minister highlighted this as a crucial step in localizing the industry due to its significant impact.

Alkhorayef noted that this initiative will improve industrial capabilities, strengthen supply chains, and increase local production. It aims to meet both local and regional automobile demands while positioning Saudi Arabia as a global automotive hub. The project aligns with the Kingdom's industrial goals, transforming ambitions into reality.

The National Industrial Strategy seeks to attract three global car manufacturers to produce 300,000 vehicles annually within one complex. With Hyundai joining Lucid and Ceer, this goal is now being realized. The factory is expected to produce 50,000 vehicles each year and contribute around $5 billion to Saudi Arabia's GDP by 2045.

PIF plays a vital role in driving industrial transformation by empowering high-value sectors with tangible economic impacts in Saudi Arabia and the region. Alkhorayef praised PIF’s efforts alongside other government entities in advancing automotive industry localization, including establishing the Hyundai plant.

The minister expressed gratitude towards various ministries such as Investment, Energy, Finance, Economy and Planning; along with the National Industrial Development Center; and the Saudi Industrial Development Fund for their integrated efforts in supporting this initiative.

Hyundai's Market Presence

Hyundai has been present in the Saudi market for over four decades and currently holds the second-largest market share in the Kingdom’s automotive sector. This longstanding presence underscores its commitment to contributing significantly to Saudi Arabia's automotive industry growth.

This strategic move not only strengthens local production but also enhances supply chains while developing local content. It consolidates Saudi Arabia's position as a key player in the global automotive landscape by meeting both domestic and regional demands effectively.

With inputs from SPA