Lexus emerges as a winner of GCC accord/node/1788416/business-economy
Lexus emerges as a winner of GCC accord
Driving through AlUla in a Lexus , Saudi Arabia’s Crown Prince Mohammed bin Salman took Qatar’s Emir Sheikh Tamim bin Hamad Al-Thani on a cruise around the heritage sites on Tuesday.
Lexus, Toyota vehicles have long been the best-selling brands in KSA
Updated 07 January 2021
Diana Farah
DUBAI: As the 41st Gulf Cooperation Council (GCC) Summit ends, Saudi Arabia and its allies have taken a historic step in restoring full diplomatic relations with Qatar after a three-year dispute.
Lexus, the luxury division of Japanese car brand Toyota, also emerged as a winner of the GCC reconciliation.
Driving through AlUla in a Lexus LX570SS model, Saudi Arabia’s Crown Prince Mohammed bin Salman took Qatar’s Emir Sheikh Tamim bin Hamad Al-Thani on a cruise around the heritage sites on Tuesday.
The flashy model has 383-horsepower, 5.7-liter v8 engine and 7,000-lb towing capacity.
Lexus and Toyota vehicles have long been the best-selling car brands in Saudi Arabia, thanks to Abdul Latif Jameel (ALJ), a family-owned diversified business founded in Jeddah in 1945 by Sheikh Abdul Latif Jameel.
The Saudi company became an official Toyota distributor in 1955 and began exporting and distributing Lexus cars in 1989. ALJ was importing and selling over 200,000 Toyota vehicles per year during the 1980s.
Toyota’s market share remains high in Saudi Arabia, hitting 35 percent in 2016.
In 2019, Toyota led car sales in the Kingdom by 27.7 percent. According to a YouGov study conducted by Arab News Japan in the same year, 56 percent of Arab respondents associated Japan with car manufacturing, and considered Toyota a favorite brand in high demand.
The study also found that 13 percent viewed Nissan and Lexus as favored automobiles.
Photos of the two royals emerged on social media and inspired reactions from Saudis, Qataris and Japanese Twitter users.
One Twitter user from Japan was proud to see Saudi Arabia’s crown prince and the Qatari emir take a cruise in the Lexus: “This is Toyota’s Lexus! Saudi Arabia recovered its diplomatic relations with Qatar. As a Japanese living in the Middle East, I’m a little proud of it.”
Another user from Saudi Arabia noted that Lexus gained some recognition from the GCC reconciliation.
Toyota is not the only Japanese firm to have strong business relationships in Saudi Arabia, with recent deals between the two nations including the Saudi Electricity Co. signing an agreement with Tokyo Electric Power Co., Nissan Motor Co. and Tecaoca Coco Energy Solutions Co. to implement electric vehicles and adapt them for Saudi use.
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Supplier hub to anchor Saudi car industry, says TASARU CEO
Updated 7 sec ago
Nada Alturki
RIYADH: Saudi Arabia’s Public Investment Fund is stepping up efforts to localize automotive manufacturing, with its portfolio company TASARU announcing partnerships with five Tier-1 global suppliers to localize advanced component manufacturing in the Kingdom.
The agreements were announced at the fourth PIF Private Sector Forum in Riyadh. TASARU also revealed plans to establish a new Supplier Hub in the King Salman Automotive Cluster in King Abdullah Economic City, designed to support next-generation vehicle development and strengthen the national automotive ecosystem in alignment with Vision 2030.
TASARU also revealed plans to establish a new Supplier Hub in the King Salman Automotive Cluster in King Abdullah Economic City. Supplied
Speaking to Arab News on the sidelines of the forum, Michael Mueller, CEO of TASARU, said: “You cannot build cars without having the right partners from the supplier side, and with that, together with the OEMs, we selected the partners that we just announced today to localize them.”
He added that the presence of large international suppliers is expected to attract smaller Tier-2 and Tier-3 manufacturers, helping the ecosystem scale.
The five partners include Shin Young for metal stamping and body structures, JVIS for exterior plastics, and BENTELER for chassis and hot-formed steel components. Guangxi Fangxin will supply interior systems, while Lear Corp. completes the group, with all expected to establish manufacturing operations in the Kingdom.
Founded more than three years ago, TASARU was established to introduce new technologies into Saudi Arabia’s mobility sector. The company has prioritized localizing smaller OEM and supplier businesses while bringing next-generation solutions into the Kingdom.
Mueller said visible progress on factory construction by Ceer, Lucid and Hyundai is shifting perceptions about the sector’s viability.
“A lot of people on the sideline watched whether automotive is really happening,” he said. “Now they recognize that the factories … are under construction, so that’s the first signal that it’s not just the bubble. It’s not just PowerPoint. It’s getting real now on the ground.”
The CEO shares that KAEC is positioned as a hub for Saudi Arabia’s automotive industry, making it a strategic location for the TASARU Supplier Hub. The facility is designed to support OEMs and next-generation vehicles, including Ceer and Lucid Motors, through a shared, just-in-time manufacturing model with integrated logistics and regulatory support.
TASARU will provide infrastructure and operational support, while partners bring technical expertise and gradually develop training centers to build a local workforce, Mueller said.
He positioned Saudi Arabia as an attractive base for global suppliers because of its access to minerals and rare earth resources, energy availability and coordination across PIF portfolio companies and government entities.
“They have access to minerals. They have access to rare earth. They can benefit from what is already existing. They have stable energy solutions. I think this footprint might benefit from the whole ecosystem as it is, not just automotive,” he said.
Companies without a Saudi footprint risk missing a “huge opportunity,” Mueller added.
He said advancing the industry will require clearer regulatory frameworks, including defined trigger points and licensing pathways that allow companies to execute their mandates.
“Of course, you need to have more or less the regulatory framework to allow autonomous cars, sooner or later, on the streets. But it's happening, and this is a huge chance also for Saudi Arabia,” Muller said.
He added: “If you are advanced in bringing such regulations onto a fast track, then you have a huge opportunity to be one of the first countries that establish this.”
With rising traffic levels in Riyadh, Mueller said emerging mobility technologies could help solve first- and last-mile transportation challenges.
“If the Metro is already full, that is good because people are using it. Now, you have to connect the dots. You have to finally make sure that people get from home to the metros and or to the bus station. So this first last-mile transportation is something where new technologies might help to bridge that,” he said.
The CEO said the project is expected to take roughly one and a half to two years for suppliers to go live. More broadly, the initiative reflects Saudi Arabia’s transition from investment attraction to full-scale industrial localization, strengthening local content, private-sector participation, and long-term industrial resilience in line with Vision 2030.
