Riyadh Opens the Way for Driverless Parcel Delivery

One of the autonomous trucks (Asharq Al-Awsat)
One of the autonomous trucks (Asharq Al-Awsat)
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Riyadh Opens the Way for Driverless Parcel Delivery

One of the autonomous trucks (Asharq Al-Awsat)
One of the autonomous trucks (Asharq Al-Awsat)

As the mobility landscape within Saudi cities continues to evolve, Riyadh is preparing to embark on a new experience in which no driver sits behind the wheel and the success of a journey does not depend on a driver's ability to navigate the road. By mid-November, 24 autonomous trucks are expected to begin trial operations on the capital's roads, opening the door for the technology to move from passenger transport into parcel and freight delivery.

The move follows the General Transport Authority's sponsorship in May of a memorandum of understanding between Abdul Latif Jameel Motors and China's Zeelos Technology, a company specializing in autonomous driving technologies, with the aim of adopting and enabling autonomous mobility solutions in the Kingdom.

The trucks expected to operate in Riyadh represent one of the practical applications of this cooperation. The first phase will focus on testing the ability of autonomous vehicles to transport parcels within the capital, paving the way for an assessment of their performance and efficiency before moving to broader stages of operation.

Ammar Baterdok, General Manager of Mobility Solutions Projects at Abdul Latif Jameel Motors, told Asharq Al-Awsat that the pilot operation will begin after the completion of geospatial mapping and the training of autonomous driving systems on local roads.

He explained that the fleet allocated to the first phase comprises 24 trucks of different sizes and models. Four have already arrived in the Kingdom, while another 20 are currently in transit, amid logistical challenges affecting shipments from China due to developments in the region.

The trucks have payload capacities of 0.5 tons, 1.5 tons, and 2.5 tons. The fleet includes refrigerated and non-refrigerated models, with the remaining batches expected to arrive successively during October and November.

Free Trials with SPL

Abdul Latif Jameel Motors is carrying out the pilot phase in cooperation with Saudi Post | SPL to transport parcels from the main center to neighborhood centers in Riyadh. The service will be provided free of charge throughout the trial period.

Baterdok said the company is prepared to extend the pilot period for several months if necessary in order to collect sufficient operational and investment data to assess the fleet's performance and economic viability before making a decision on commercial expansion.

The phase will allow the company to test the vehicles under actual driving conditions within the capital, including their ability to navigate local roads and traffic, while also measuring their performance during different operating hours.

Millions Invested to Test Viability

The cost of the pilot phase amounts to millions of riyals, according to Baterdok, covering the purchase of vehicles, customs clearance, fees, and taxes. He explained that the investment is not intended to generate a direct financial return, but rather to test the technology's economic and technical viability and collect the data needed before decisions are made regarding commercial expansion and the size of the future fleet.

Illustrative photo of the inside of the truck (Asharq Al-Awsat)

Operating Savings Could Exceed Truck Costs

The company is banking on autonomous trucks being able to reduce operating costs compared with conventional vehicles. Baterdok explained that the price of an autonomous truck is approximately half that of a conventional fuel-powered truck, whether gasoline or diesel.

The cost gap becomes wider during operation due to lower labor and maintenance expenses, in addition to the possibility of operating the trucks around the clock, except for the periods required for recharging.

In an analysis, logistics expert Hassan Al Halil told Asharq Al-Awsat that the most significant economic impact would come from reducing operating costs and improving supply-chain efficiency. He noted that autonomous trucks could increase fleet utilization, improve route planning, and allow for longer operating periods, particularly on repetitive and defined routes.

Al Halil added that it is too early to establish a fixed percentage for reductions in logistics costs in Saudi Arabia, given that savings vary depending on the type of shipment, distance, and operating model. He said that "the greatest opportunities for savings lie in operating labor costs, increasing truck utilization, reducing waiting times, improving fuel consumption, and maintenance," adding that "the economic value will come from increasing fleet productivity and completing more trips efficiently."

Baterdok, meanwhile, said the absence of a driver allows supply and delivery operations to be shifted to nighttime hours, increasing the efficiency of fleet utilization in major cities such as Riyadh by taking advantage of periods when road traffic is less dense.

According to company estimates, electricity costs account for only about 20 percent of the cost of conventional fuel, while maintenance expenses decline due to the absence of conventional engines and transmissions. Routine servicing therefore focuses to a greater extent on components such as brakes and tires.

The trucks rely on sensors and radar systems for autonomous driving, enabling them to operate in nighttime driving conditions without relying on human vision.

Road Readiness Determines the Path to Expansion

Despite these advantages, Al Halil believes that large-scale operation of autonomous trucks in Riyadh requires more than well-maintained roads. It requires highly accurate maps that are continuously updated, reliable communications systems, smart infrastructure, and coordination among the relevant authorities.

He pointed out that the main challenges within cities include congestion, sudden changes in routes, roadworks, unexpected behavior by some vehicles, dusty conditions, and the handling of loading and unloading points. He said that "the most realistic starting point will be defined, repetitive roads and logistics routes before moving to more complex urban operations."

From Passenger Transport to Parcel Delivery

The truck trial comes as Saudi Arabia expands its testing of autonomous mobility applications, as the technology moves from passenger transport into freight and delivery.

Last year, Saudi Arabia launched autonomous passenger vehicles and is currently operating more than five routes, including the Roshn area, Princess Nourah bint Abdulrahman University, and the route connecting Riyadh Gallery and Hayat Mall.

The service has transported more than 3,100 passengers across 1,600 trips under the supervision of the General Transport Authority, as part of efforts to test autonomous driving technologies in the Saudi urban environment.

The expansion of these applications into the freight sector opens a new field for testing the impact of autonomous driving on the efficiency of delivery operations within cities, at a time when e-commerce is expanding and supply chains are seeing growing demand for more efficient and flexible solutions.

From Roads to the Sky

Abdul Latif Jameel Motors' plans do not stop at ground transportation. The company has begun studying the market for drone-based goods delivery in preparation for entering the field once the necessary regulatory frameworks are in place.

Baterdok expects the process of developing regulations governing goods delivery by drones to take between one and a half and three years. He noted that the company is in discussions with global suppliers of trucks and drones designed to transport goods and individuals.

In evaluating these solutions, the company is focusing on technical readiness, range, speed, the ability of vehicles and aircraft to operate under different weather conditions, and resistance to wind, with the aim of achieving operational readiness as soon as official licenses are issued.

Accordingly, Abdul Latif Jameel Motors' plan is not limited to testing autonomous trucks in Riyadh. It extends to developing a broader system of autonomous mobility solutions, beginning with ground transportation and eventually reaching air-based goods delivery, while testing the technical and economic viability of each solution before moving from trials to commercial expansion.



Saudi Economy Relies on Non-Oil Growth Engines to Absorb External Shocks

Oil fields operated by Saudi Aramco (Aramco)
Oil fields operated by Saudi Aramco (Aramco)
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Saudi Economy Relies on Non-Oil Growth Engines to Absorb External Shocks

Oil fields operated by Saudi Aramco (Aramco)
Oil fields operated by Saudi Aramco (Aramco)

Saudi Arabia's economic indicators show a growing ability to withstand external shocks, supported by an expanding non-oil sector that has continued to grow despite geopolitical tensions and disruptions to regional trade and energy routes.

Although gross domestic product (GDP) contracted by 3.8% year on year in the third quarter of 2026, the pace of decline slowed from a 4.7% contraction in the second quarter. Non-oil activities grew by 1.9%, accelerating from 0.9% in the previous quarter, while oil activities declined by 20.4%.

The significance of this performance is particularly evident given the exceptional circumstances of the third quarter, including disruptions to shipping through the Strait of Hormuz and the temporary shutdown of the East-West Pipeline in September.

Seasonally adjusted real GDP also grew by 1.3% compared with the second quarter, indicating an improvement in economic activity on a quarterly basis and reflecting the ability of certain sectors to continue expanding despite the sharp contraction in oil activities.

Annual and Quarterly Performance

According to data from the General Authority for Statistics, oil activities were the main driver of the GDP contraction, contributing a negative 4.7 percentage points, while government activities subtracted 0.4 percentage points.

By contrast, non-oil activities made a positive contribution of 1.1 percentage points, while net taxes on products added approximately 0.1 percentage points.

The data also showed an improvement in economic performance on a quarterly basis, with seasonally adjusted real GDP increasing by 1.3% in the third quarter compared with the second quarter of this year.

The growth was driven by a 5.7% increase in oil activities and a 0.6% rise in non-oil activities, while government activities declined by 1.2%.

Last month, the International Monetary Fund (IMF) noted that Saudi Arabia's available fiscal buffers and alternative oil export facilities were helping limit the economic damage caused by the war. The Fund considered the Kingdom better positioned than its Gulf peers to contain the fallout from the disruptions.

The IMF projected a strong recovery in the Saudi economy in 2027, forecasting growth of 7.9% amid expectations of a rebound in oil activities and improvements in trade and shipping.

These projections are particularly significant in light of Saudi government estimates that the economy will contract by 3.6% in 2026, with the projected budget deficit rising to 4.9% of GDP.

The contrasting performance of oil and non-oil activities underscores the importance of the structural transformation underway in the Saudi economy.

Non-oil activities are no longer merely an additional contributor to GDP. They are playing an increasingly important role in absorbing shocks and limiting the transmission of volatility in the energy sector to the broader economy.

Promising Sectors

Since the launch of Vision 2030, the Saudi government has pursued a clear strategy to diversify income sources and broaden the economic base by accelerating non-oil growth and developing promising sectors.

These include information technology and artificial intelligence, transportation and logistics, tourism, entertainment and quality of life, renewable energy and sustainability, as well as mining, manufacturing and other targeted industries.

These efforts have helped diversify sources of economic activity and strengthen the contribution of non-oil sectors, giving the Saudi economy greater flexibility to withstand external fluctuations by diversifying sources of value added and expanding the role of domestic businesses and the private sector.

Consumer Spending

In this context, Dr. Abdullah Al-Mir, Assistant Professor of Economics at King Fahd University of Petroleum and Minerals, told Asharq Al-Awsat that the contraction in the Saudi economy during the third quarter was not broad-based. Instead, it was concentrated largely in oil activities, which declined by approximately 20%.

Non-oil activities, meanwhile, continued to grow by 1.9%, playing an important role in cushioning the impact of the sharp decline in the oil sector.

According to Al-Mir, government spending and private sector activity are two key pillars of this resilience. Continued consumer spending by households and the private sector helps sustain domestic demand in trade, retail, hospitality, services and transportation, all labor-intensive activities directly linked to the non-oil economy.

He noted that the Riyad Bank Purchasing Managers' Index (PMI) reached 55.3 in September 2026, remaining in expansion territory for the sixth consecutive month, reflecting continued improvement in non-oil private sector activity.

Al-Mir explained that the importance of non-oil activities becomes even clearer when the energy sector slows. Sustained activity in services, entertainment and domestic tourism helps small and medium-sized enterprises remain operational, preserves local supply chains and supports employment opportunities.

He emphasized the importance of strengthening the resilience of the non-oil private sector against external volatility.

Al-Mir added that one of the most significant signs of Saudi Arabia's economic transformation was the increase in the share of non-oil activities to 57.3% of the economy, describing it as a historic level that reflects a structural shift in the country's economic composition.

He linked this transformation to the decline in the unemployment rate among Saudi nationals to 6.5%, highlighting the potential impact of expanding non-oil activity on the labor market.

Al-Mir noted that sectors such as tourism, entertainment, technology and manufacturing continued to expand despite geopolitical disruptions that affected oil production and shipping, further demonstrating the structural transformation of the Saudi economy.

"Non-oil activities have a greater capacity to withstand shocks, while sustained investment momentum associated with Vision 2030 provides an alternative source of growth," he said.


Saudi Arabia Records 6,484 Franchise Registrations, Up 53%

A consumer goods store in Saudi Arabia (SPA)
A consumer goods store in Saudi Arabia (SPA)
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Saudi Arabia Records 6,484 Franchise Registrations, Up 53%

A consumer goods store in Saudi Arabia (SPA)
A consumer goods store in Saudi Arabia (SPA)

Commercial franchise registrations in Saudi Arabia grew by 53% during the first nine months of 2026, reaching 6,484, compared with 4,227 at the end of 2025, according to the Ministry of Commerce.

The ministry said the food and beverage, fuel and petroleum, and fashion and apparel sectors accounted for the highest number of franchise registrations in the Kingdom.

It explained that the Commercial Franchise Law aims to regulate and develop the sector, enhance transparency, protect the rights of all parties involved, and create an attractive investment environment.

It also seeks to improve the quality of goods and services and support the sustainability, growth and expansion of commercial activities.


Saudi Stock Market Falls 0.8% for Second Consecutive Session

A man walks past the Tadawul logo at the Saudi stock exchange (AFP)
A man walks past the Tadawul logo at the Saudi stock exchange (AFP)
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Saudi Stock Market Falls 0.8% for Second Consecutive Session

A man walks past the Tadawul logo at the Saudi stock exchange (AFP)
A man walks past the Tadawul logo at the Saudi stock exchange (AFP)

Saudi Arabia's benchmark Tadawul All Share Index (TASI) closed Sunday's session down 0.8% at 9,838 points, shedding 83 points amid total trading turnover of approximately SAR 3.1 billion.

The decline marked the index's second consecutive losing session after it fell 1% on Thursday to 9,922 points, ending a three-day winning streak that began with a 3.4% surge on Monday, followed by gains of 2.3% on Tuesday and 0.4% on Wednesday.

Despite Thursday's losses, the index ended last week up approximately 2.4%.

During Sunday's session, the benchmark fluctuated between a low of 9,789 points and a high of 9,923 points, moving further away from the 10,000-point threshold it had surpassed during trading last week.

Market Declines

Among heavyweight stocks, Al Rajhi Bank edged down approximately 0.1%, while ACWA Power fell around 3%.

Shares of Alujain and SPIMACO dropped approximately 10% each, while Saudi Reinsurance (Saudi Re) declined 8% and Jabal Omar Development fell around 7%.

Dr. Sulaiman Al Habib Medical Services Group and ZOUJAJ closed at SAR 214 and SAR 35.02, respectively, down 3% and 2% following the passing of their dividend eligibility dates.

Elm Leads Gains

In contrast, Elm shares surged approximately 9% following the release of the company's financial results.

SAHL rose around 4%, Sports Clubs Company gained more than 4%, and Watani Iron Steel advanced more than 2%.

BinDawood Holding and Sumou Real Estate each jumped 5%.