Korea’s top car manufacturer, Hyundai, is set to establish an electric vehicle assembly plant in Saudi Arabia. Hyundai is due to be the first Korean automaker with an assembly plant in the Middle East. They are currently the second-largest carmaker in Saudi Arabia with over 47,000 vehicles sold in the first half of 2023.
The Hyundai-PIF Joint Venture
The joint venture will see Hyundai and the PIF working together to build a state-of-the-art manufacturing plant with an estimated investment exceeding $500 million. The PIF will hold a 70 percent stake in the venture, with Hyundai holding the remaining 30 percent.
The partnership aims to manufacture 50,000 vehicles per year, including both Internal Combustion Engine (ICE) vehicles and Electric Vehicles (EV). Hyundai will also act as a strategic technology partner, offering technical and commercial assistance to facilitate the establishment of the manufacturing plant.
The groundbreaking of the plant is planned for 2024, with production expected to begin in 2026. The specifics of the plant’s location and the models to be manufactured have not yet been disclosed.
Saudi Arabia’s Automotive Ambitions
Saudi Arabia, known for its vast oil reserves, is looking to diversify its economy and become a hub for automotive manufacturing. With the kingdom’s Vision 2030, the nation aims to manufacture more than 300,000 cars annually by the end of the decade.
The Hyundai-PIF partnership aligns with these ambitious plans, marking a significant step in the transformation of the Saudi automotive sector.
Hyundai’s Global Automotive Leadership
As the third-largest automaker worldwide in terms of sales volume, Hyundai brings invaluable technical capabilities and expertise to the venture. The collaboration will not only foster a sustainable and eco-friendly automotive future in the region but also create opportunities for innovation and environmental progress.
Economic Impact and Job Creation
The new manufacturing plant will create new jobs and allow for knowledge and expertise transfer. The localization of Hyundai’s vehicles will accelerate the development of Saudi Arabia’s automotive and mobility ecosystem and attract further investments to the sector and the wider economy.
Hyundai’s decision to establish an EV assembly plant in Saudi Arabia is a strategic move that aligns with the kingdom’s vision to diversify its economy. The joint venture with the PIF signifies a significant milestone for Hyundai and further strengthens its global presence in the automotive industry.
The implementation of this project will undoubtedly have a profound impact on the Saudi economy, create jobs, and foster a sustainable and eco-friendly automotive future in the region. As we watch this ambitious project unfold, there is no doubt that Hyundai’s presence in Saudi Arabia will be a game-changer in the region’s automotive sector.
Growth of Electric Vehicle Companies in Saudi Arabia
[Image Credit: Lucid Motors ]
Lucid Motors is expanding its global reach into Saudi Arabia, backed by substantial investment from the country’s Public Investment Fund (PIF). This strategic move supports Saudi Arabia’s Vision 2030 by promoting eco-friendly transportation and diversifying the economy away from oil dependency.
Saudi Arabia introduced CEER, its pioneering electric vehicle brand, to the automotive market with PIF’s support. As part of Vision 2030, CEER embodies the Kingdom’s drive towards sustainable innovation and economic diversification.