The Kingdom of Saudi Arabia is the largest car market in the Middle East (excluding Iran): there are around 8 million cars on the roads and sales in 2011 was reached to 759,000; and there is strong, increasing demand for automotive parts such as tyres (10 million a year and rising by 12% a year).
The Ministry of Commerce and Industry's Industrial Clusters program (IC) is developing Saudi Arabia's automotive capabilities and capacity. Its targets include production of 600,000 cars a year by 2025.
Several major projects have been done such as ,In Dammam, Isuzu Motors and Saudi Industrial Property Authority (Modon) developed a $100 million, 120,000 sq m integrated factory to build trucks and cars. The plant produced its first trucks in 2012 and will have a capacity of 25,000 trucks a year by 2017. It will create some 800 jobs and is expected to export 40% of its production.
Wadi al-Riyadh Technology (the investment arm of King Saud University (KSU)) and Riyadh Valley Company (a KSU affiliate) are developing a new sport utility vehicle, the Gazal. The consortium aims to produce up to 20,000 Gazals a year, primarily for Middle East-North Africa.
Elsewhere in Saudi Arabia, the National Program for Automotive Technology, an affiliate of King Abdulaziz City for Science and Technology (KACST), has developed a new saloon car, the ASEELAH.
Industrial Clusters aims to attract and support:
- Vehicle assembly projects for Saudi and Middle East markets, with production of up to 600,000 cars a year by 2025
- Tyre plants for Saudi and export markets (totalling 8 million-10 million tyres a year)
- Power train projects for Middle East and global markets
- Major tier 1 suppliers (systems and modules)
- Small- and medium-sized tier 2 suppliers (sub-systems, sub-assemblies and components)
- Smaller tier N suppliers (standard parts and materials)
- Industry-related services such as R&D and training
Industrial Clusters is developing all aspects of the automotive supply chain, including the production of carbon black and synthetic rubber (for tyres), carbon fibre, oil filters, circuit boards, batteries, cabling, sensors, adhesives, paints, composites, trim and seats.
It is also focusing on areas of particularly strong advantage, such as parts produced using relatively large amounts of steel, aluminium, glass, plastics and energy.