South Korean President Moon Jae-in announced on Sunday that Hyundai Motor Group has agreed to construct an automobile manufacturing plant in Saudi Arabia in partnership with the Public Investment Fund, the kingdom’s sovereign wealth fund.
President Moon made this announcement in Riyadh, where the agreement between the Public Investment Fund and Hyundai was officially signed.
A joint statement revealed that the plant’s annual production capacity would reach 50,000 vehicles, powered by both electricity and gas. Notably, this marks the first-ever South Korean car manufacturing facility in the Middle East.
The statement also outlined, “The Public Investment Fund will hold a 70 percent stake in the joint venture, while Hyundai will own 30 percent… Estimated investments in the project exceed 1.8 billion riyals ($500 million).”
Hyundai Motor Group, the world’s third-largest car manufacturer in terms of sales, is embarking on this venture in Saudi Arabia as part of the nation’s economic diversification efforts, moving away from its dependence on oil. The goal is to produce more than 300,000 vehicles annually by 2030.
The joint statement, as reported by the Saudi Press Agency (SPA), also revealed that Hyundai would act as a “strategic technology partner in developing the new plant by providing technical and commercial support.”
President Moon stated that the first vehicles from the production line are expected to be rolled out by 2026. However, specific details regarding the plant’s location or the car models to be manufactured there were not disclosed.
During his visit to Saudi Arabia, President Moon met with Crown Prince Mohammed bin Salman, where several agreements were signed, including the establishment of strategic partnerships and cooperation in the realm of “green” hydrogen.
Additionally, South Korea and Saudi Arabia are set to sign 51 agreements and memoranda of understanding worth a total of $15.6 billion during President Moon’s visit to the Kingdom, as reported by South Korea’s Yonhap News Agency on Sunday.
