Hyundai builds its first plant in the Middle East
Hyundai has begun construction of its first plant in Saudi Arabia, which will be its first production facility in the region. Located in the King Salman Automotive Cluster, the plant is scheduled to open by the end of 2026. Its capacity will be up to 50,000 vehicles per year, including both electric cars and internal combustion engine models.
This project is a joint venture between Hyundai and Saudi Arabia’s Public Investment Fund (PIF), with PIF owning 70% of the shares and Hyundai holding 30%. The plant will be part of Saudi Arabia’s economic diversification strategy under the Vision 2030 program, which aims to reduce dependence on the oil sector.
Strategic investments in the automotive industry
Saudi Arabia is actively attracting global automakers to establish production facilities in the country. For example, Lucid Motors already has a plant in the kingdom where it assembles the Air model. Hyundai, in turn, expects that the new facility will help it establish a foothold in the local market and expand export opportunities.
Interestingly, despite the global trend toward electrification, Hyundai is not abandoning the production of vehicles with traditional engines. This may be due to regional demand characteristics, where electric vehicle infrastructure is still developing. The plant is expected to become a key element in the company’s strategy to capture markets in the Middle East and North Africa.