RIYADH: Saudi Arabia’s Public Investment Fund on Sunday signed an agreement with Hyundai Motor Co. to establish an automated vehicle manufacturing plant worth over $500 million in the Kingdom.
The wealth fund will hold a 70 percent stake in the joint venture with the Korean automaker holding the remaining shares, said a PIF statement.
Hyundai will also act as a strategic technology partner to support the development of the plant, by providing technical and commercial assistance.
The joint venture announced at the Saudi-Korean Business Forum, aims to manufacture 50,000 vehicles per year, including both internal combustion engines and electric vehicles. The plant groundbreaking is planned for 2024, and production is expected to begin in 2026.
Commenting on the project, Yazeed A. Al-Humied, deputy governor and head of MENA Investments at PIF, said: “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.”
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. Among the major investments in the sector, PIF announced recently the launch of Tasaru, the National Automotive and Mobility Investment Co., which is dedicated to localizing automotive supply chains and manufacturing capabilities. In addition, PIF and Saudi Electricity Co. announced the Electric Vehicle Infrastructure Co., with plans to install over 5,000 electric car fast chargers across Saudi Arabia by 2030.
As the third-largest automaker worldwide in terms of sales volume, Hyundai Motor Group brings invaluable technical capabilities and expertise to design, develop, and operate the vehicle manufacturing plant.
Jaehoon Chang, president and CEO of Hyundai Motor Co., said: “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.”
The completion of the joint venture agreement is subject to obtaining customary approvals from the relevant authorities and satisfaction of conditions, the statement added.
