Business registrations see 78% annual growth as Saudi private sector booms

E-commerce saw a 17.47 percent yearly increase in issued records, reaching 40,697 registrations. Shutterstock 
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Updated 04 July 2024
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Business registrations see 78% annual growth as Saudi private sector booms

RIYADH: More than 120,000 commercial registrations were issued by the Saudi Ministry of Commerce in the second quarter of 2024, marking a 78 percent year-on-year increase.   

According to data from the ministry, a total of 121,521 official identification cards for businesses were issued during the three months to the end of June, up from 68,222 in the same period last year. 

The data also revealed registration growth across several key sectors. E-commerce saw a 17.47 percent yearly increase in issued records, reaching 40,697 registrations. 

Container handling services experienced a 48 percent growth with 2,457 registrations, while logistics services saw a 76 percent increase, totaling 11,928 registrations. 

Urban and suburban passenger transportation, arts, entertainment and recreation, and short-term accommodation all saw increases in registrations, as did  cloud computing services. 

Notably, artificial intelligence commercial registrations rose by 53 percent, reaching 8,948. 

The electronic games industry, mining and quarrying, and the manufacture of pharmaceuticals and medicinal products also recorded rises in commercial registrations. 

This surge comes as the Kingdom ranks among the top 20 countries with the most competitive global markets, holding the 16th position out of 67 countries, according to the World Competitiveness Ranking by the International Institute for Management Development

Additionally, Saudi Arabia ranks fourth among the G20 countries in terms of business legislation and infrastructure, highlighting its commercial appeal. 

The Saudi Ministry of Commerce’s vision is to achieve a pioneering position for the commerce sector in the Kingdom within a fair and stimulating environment. To this end, the ministry aims to develop and implement effective policies and mechanisms to contribute to sustainable economic development. 

Riyadh recorded the highest number of commercial registrations during the second quarter of the year with 52,192, followed by the Eastern Provinces with 20,148, and Makkah with 18,904.   

The report also indicated that 45 percent of registrations were issued to females. Currently, the Kingdom has granted over 1.5 million commercial instruments. 

Additionally, Saudi Arabia’s non-oil private sector showcased robust growth in June, driven by increased demand, higher output levels, and a rise in employment, according to a report. 

The latest S&P Global Purchasing Managers’ Index showed that the Riyad Bank Saudi Arabia PMI stabilized at 55 from 56.4 in May, marking the lowest reading since January 2022.  

Despite the slowdown in new orders, which saw the slowest growth in nearly two and a half years, non-oil businesses reported a substantial rise in output, helping the Kingdom lead the region with the strongest expansion figures.


Lucid’s move into Alkhobar marks a new phase in Saudi Arabia’s electric transition

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Lucid’s move into Alkhobar marks a new phase in Saudi Arabia’s electric transition

ALKHOBAR: Lucid opened its first showroom in Alkhobar on Dec. 5, completing its presence across Saudi Arabia’s three largest regions and underscoring the rapid progress of the Kingdom’s electric-mobility push under Vision 2030.

The new Eastern Province location targets one of the nation’s highest-spending markets and reflects the deepening US-Saudi partnership behind Lucid in manufacturing, research and development, and talent.

For the EV maker, the move reflects pure market demand, according to interim CEO Marc Winterhoff.

“We didn’t have any coverage of the eastern region. It’s the 3rd largest market in KSA, and therefore it’s important for us to be here as well, closer to our customers,” he said.

Saudi Arabia has become one of Lucid’s most critical markets globally, not only as a buyer, but as a manufacturing base and a long-term strategic partner.

Winterhoff said the company is “super important in all of those categories,” highlighting how the Public Investment Fund’s backing enabled Lucid to grow jobs in the US while establishing its first international facility in the Kingdom.

“It’s widely known that we are majority funded by PIF, meaning the Kingdom of Saudi Arabia, which enabled us to build actually a lot of jobs in the US. Over 90 percent of our jobs … are in the US,” he said.

Lucid interim CEO Marc Winterhoff. Khalil Alazwari

At the same time, Lucid is expanding its assembly plant in King Abdullah Economic City and preparing to hire “thousands of people” as it ramps up production by the end of next year.

Alignment with Vision 2030, particularly the shift toward sustainability and the creation of entirely new industries, is becoming a defining pillar of Lucid’s strategy in the Kingdom. “Our vision is very much aligned with Vision 2030,” Winterhoff said.

He pointed to the emergence of a Saudi automotive cluster for the first time, with Lucid among the first manufacturers and others now entering the market. “There was no automotive industry before … and yeah, that wouldn’t be possible without the support.”

Regionally, Lucid Middle East President Faisal Sultan said the Gulf is entering a new phase of EV adoption driven by consumer readiness and government action.

“The whole country is going through a transformation right now. There is a renewed focus on sustainability and diversification to non-oil GDP,” he said.

While global supply chain issues briefly slowed EV momentum, demand in Saudi Arabia is now growing faster than in several other GCC countries.

Sultan said the Alkhobar showroom will play a direct role in accelerating adoption by exposing more customers to the vehicles.

“Once the customer is inside the car and sees a beautiful car that has amazing performance attributes, then the conversion is a sure deal,” he said.

Market behavior also shaped the decision to expand east. Many Eastern Province customers had been traveling to Riyadh to buy vehicles, a barrier Lucid sought to address. “It is a little bit of an inconvenience … so we really needed to be here,” Sultan explained.

The location’s economic weight also played a role. “There’s a lot of buying power here, and Lucid vehicles are a highly technological luxury vehicle. So it is the right place for Lucid to be.”

On charging, Lucid is working on a two-track approach: building infrastructure and educating customers. The company is pushing back against common assumptions around range anxiety by highlighting its vehicles’ capabilities.

“We are the longest-range vehicle in the world — 835 (km) to 838 km on a single charge,” Sultan said. He added that many drivers can travel from Alkhobar to Riyadh and might even go back on one charge.

The Lucid Air showcased inside the new Alkhobar studio. Khalil Alazwari

Lucid now provides a free home charger and free installation with every purchase, ensuring most customers rarely run low on battery in daily use.

The company is also expanding public charging through partnerships with hotels and offices. “We have about 50 of them across the country, and anybody can use it,” he said.

The localization push, a major pillar of Vision 2030, is another area where Lucid is scaling quickly. “We are 70-plus percent Saudized. That is an amazing feat because we are a technological company,” Sultan said.

The firm is also investing in a new R&D center in Riyadh, training Saudi engineers in the US through Human Resources Development Fund’s programs, and building a talent pipeline with institutions including KAUST, King Abdullah Economic City’s training academy NAVA, and technical universities.

Sultan said this effort is essential as the plant transitions next year from assembly to a complete build-unit factory with a planned annual capacity of 150,000 vehicles.

“You’re gonna need a large workforce,” he said. “This is all in preparation to localize the workforce and having the right skills available.”

With the Eastern Province now covered, Lucid’s footprint matches the Kingdom’s three economic engines: Riyadh, Jeddah, and Alkhobar, positioning the company at the center of Saudi Arabia’s EV transition.

And as both executives made clear, the Kingdom is not just a sales market for Lucid, but a core part of its global future.