The Public Investment Fund (PIF) and Hyundai Motor Company (Hyundai) have signed a joint venture agreement in order to establish a highly automated vehicle manufacturing plant in Saudi Arabia.
PIF will hold a 70 percent stake in the new joint venture with Hyundai holding the remaining 30 percent. Hyundai will also act as a strategic technology partner to support the development of the new manufacturing plant, by providing technical and commercial assistance. The total investment for the project is estimated to exceed $500 million.
The joint venture aims to manufacture 50,000 vehicles per year, including both internal combustion engine (ICE) and electric vehicles (EV). The plant groundbreaking is planned for 2024, and production is expected to begin in 2026.
The new manufacturing plant will create thousands of 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.
The partnership is PIF’s latest initiative to elevate Saudi Arabia as a global automotive player, drive transformation in the sector, and boost manufacturing capabilities, infrastructure, and supply chains in Saudi Arabia and beyond.
The joint venture also underscores PIF’s efforts to create national and regional champions, build local capabilities, attract cutting-edge technology, and create highly skilled jobs in Saudi Arabia’s automotive and mobility sectors. PIF’s investments are also localizing automotive component manufacturing in Saudi Arabia, further strengthening the automotive supply chain.
Mr. Yazeed A. Al-Humied, Deputy Governor and Head of MENA Investments at PIF, said that, “Partnering with Hyundai is another significant milestone for PIF in successfully enabling and accelerating the growth of Saudi Arabia’s automotive ecosystem – one of our 13 priority sectors. Our investment in vehicle manufacturing with Hyundai Motor Company is a pivotal milestone, aligning closely with our existing stakes in Lucid and Ceer Motors, and amplifying the breadth of Saudi Arabia’s automotive and mobility value chain.”
“We are excited about the potential of this venture to drive significant advancements in vehicle production, fostering a sustainable and eco-friendly automotive future in the region. Our joint efforts will create opportunities for innovation and environmental progress,” commented Mr. Jaehoon Chang, President and CEO of Hyundai Motor Company.
