The Public Investment Fund (PIF) and South Korea's Hyundai Motor Company (Hyundai) have signed a joint venture agreement to establish a highly automated vehicle manufacturing plant for over $500 million in Saudi Arabia.  

PIF will hold a 70% stake in the new joint venture, with Hyundai holding the remaining 30%, the sovereign fund said in a statement.

Hyundai will act as a strategic technology partner to support the development of the new manufacturing plant by providing technical and commercial assistance.  

The joint venture 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. 
 
The joint venture formation is subject to obtaining approvals from the relevant authorities.

In January, the Ministry of Industry and Mineral Resources signed a memorandum of understanding (MoU) with Hyundai to build an assembly plant based on CKD [Completely Knocked Down] system for electric and internal combustion engine cars in the Kingdom.

In May 2022, the ministry announced that Saudi Arabia aims to manufacture 300,000 vehicles in domestic factories by 2030.

(Writing by P Deol; Editing by Anoop Menon)

(anoop.menon@lseg.com)

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