Tuesday, October 24, 2023
Saudi Arabia's PIF and Hyundai to build $500m car factory in the Kingdom
The wealth fund PIF (Public Investment Fund) of Saudi Arabia signed a contract with the Hyundai Motor Company of South Korea for a car factory, including one that will produce electric vehicles (EV) in the Kingdom, giving the country's aspirations to become a center for the production of cars a further boost. Most Viewed : Fines related to Iqama in Saudi Arabia
The Public Investment Fund will own 70% of the business, while Hyundai, which will own 30%, will also serve as the "strategic technology partner" for the construction of the new factory.
- An estimated $500 million or more has been invested overall. Saudi Arabia is the largest car market in the Gulf. "Partnering with Hyundai is another important milestone for PIF in successfully promoting and accelerating the growth of Saudi Arabia's automotive ecosystem, one of our 13 priority sectors," said Yazeed A. Al-Humied, PIF's deputy governor and head of MENA Investments.
- The new company, which was unveiled at the Saudi-Korean Business Forum, intends to produce 50,000 vehicles annually, both gasoline- and electricity-powered ones. Trending : Makkah Bus to collect ticket fee from passengers starting 1st November
- The plant's groundbreaking is expected to occur the following year, and production may begin as early as the Year 2026.
- By making investments or forming agreements, like the one with Lucid Group to establish full-fledged manufacturing capabilities within the nation, Saudi Arabia has made some significant advancements in the automobile industry. The nation's resources play a significant role in supporting Rivian, an EV manufacturer.
- Hyundai's decision to transfer production to the Gulf makes sound commercial sense. Sales and attracting first-time purchasers have been booming for the company, especially for its luxury label Genesis. Recommend : Visit visas can be extended online, one week before its expiry
- In a statement, Jaehoon Chang, president and Chief Executive Officer of Hyundai Motor Company, stated, "We are thrilled about the potential of this venture to make substantial breakthroughs in car production, supporting a sustainable and eco-friendly automotive future in the region".
- According to industry sources, moving production right into the Gulf will have "immense" advantages for pricing and brand intimacy. Naturally, a lot will still depend on the models that are produced in Saudi Arabia, but there's a good likelihood that they'll be mid- and entry-level models.
- Our partnership with Hyundai Motor Company to invest in the production of vehicles is a significant step that complements our current investments in Lucid and Ceer Motors, said Yazeed A. Al-Humied of PIF.
