Saudi Arabia’s Public Investment Fund (The PIF) and Hyundai are partnering to build a $500 million car manufacturing plant in the kingdom, with an aim of producing 50,000 vehicles annually including electric vehicles starting in 2026.
The Joint Venture
The car manufacturing project, set to be a joint venture between Saudi Arabia’s Public Investment Fund and Hyundai, has an estimated investment of over $500 million.
PIF will hold the majority stake of 70%, while Hyundai will own the remaining 30%. The joint venture aims to produce 50,000 vehicles annually, including both internal combustion engine and electric-powered vehicles.
The plant is expected to start production in 2026, with the groundwork beginning in 2024.
PIF’s Vision and Strategy
Yazeed Al-Humied, deputy governor and head of Middle East and North Africa investments at the PIF, expressed that this venture aligns with Saudi Arabia’s focus on accelerating growth in the automotive industry, one of the 13 priority sectors.
This investment, alongside stakes in Lucid and Ceer Motors, amplifies Saudi Arabia’s automotive and mobility value chain breadth.
The Vision 2030 Strategy
Saudi Arabia’s Vision 2030 strategy aims to develop its domestic EV market, focusing on diversifying its oil-dependent economy.
The PIF, in collaboration with the Saudi Electricity Company, launched an EV infrastructure company that intends to set up 5,000 fast chargers across the kingdom by 2030.
More so, the PIF created a company to boost EV manufacturing and develop local supply chain capabilities for the automotive industry, marking a significant move towards achieving the Vision 2030 goals.
The National Automotive and Mobility Investment Company
The newly launched National Automotive and Mobility Investment Company, or Tasaru Mobility Investments, aims to drive strategic investment and partnerships with both local and global private firms.
This initiative is intended to stimulate the growth of the kingdom’s automotive sector.
Collaboration with Hyundai
The PIF’s collaboration with Hyundai is expected to generate thousands of jobs and foster knowledge and expertise transfer.
Hyundai, the world’s third-largest car maker, will lend its technical and commercial assistance to the plant.
The joint venture has the potential to drive significant advancements in vehicle production, fostering a sustainable and eco-friendly automotive future in the region, emphasized Jaehoon Chang, president and chief executive of Hyundai.