The Saudi Ministry of Industry and Mineral Resources signed a memorandum of understanding with Hyundai Motor Company to promote the automotive industry in the Kingdom.
The MoU was signed in the presence of the Minister of Industry and Mineral Resources, Bandar al-Khorayef, and the Minister of Economy and Planning, Faisal al-Ibrahim.
The MoU aimed to enhance cooperation in vehicle manufacturing in the region to realize the national strategic goals for the industry in developing local manufacturing capabilities and is in line with the targets of the Saudi Vision 2030 that seeks to diversify the economic base in Saudi Arabia.
The agreement stipulated planning for building a Saudi Arabia-based assembly plant with the CKD system for electric and internal combustion engine cars after Hyundai showed high interest.
It also sought to explore joint investment opportunities with Saudi Arabia to achieve entrepreneurship in businesses and projects that guarantee environmental safety and sustainability.
The approach came as part of a government strategy to support the transition to clean energy in the automotive industry.
In early November, Saudi Crown Prince Mohammed bin Salman launched the "Ceer" company, branded as the first Saudi electric vehicle brand.
The new company would contribute to attracting local and international investments and create many job opportunities for local competencies.
Last May, the Ministry of Investment announced a significant investment from Lucid Group as the firm began constructing an advanced automotive manufacturing plant that targets 150,000 vehicles per year with more than $3.2 billion in assets.
The facility is also expected to contribute significantly to job creation and development of the skill base of the Saudi automotive manufacturing sector.
Investment Minister Khalid al-Falih stated that the development of the electric car industry in Saudi Arabia reflected the strong commitment to attracting qualitative investments that contribute to diversifying the economy, transferring technology, and developing skills among Saudi youth.
It also reflected the Kingdom's global commitment to promoting a green economy and reducing carbon emissions.
Falih added that the development of the electric car manufacturing sector is part of the Kingdom's broader efforts to advance the industrial sector and advanced industries.
The sector would also play an essential role in the Kingdom's transition to a greener economy and in the Kingdom's efforts to realize its commitment to reach net zero by 2060.
The Lucid factory will produce four electric cars from 2023, reaching total capacity in 2028.
The planned factory in the Kingdom would produce two exclusive models. The facility will export nearly 95 percent of its production, supporting the Kingdom's balance of payments. It would also back supply chains and open new investment opportunities.
Lucid's electric vehicle factory would be located in the Industrial Valley of King Abdullah Economic City, on the Red Sea coast in the west of the Kingdom, to meet energy needs, local supply chains, and a location that facilitates access to global logistics.
