Hyundai and PIF Begin Construction of First Car Plant in Saudi Arabia

Saudi Arabia : New milestone for Saudi Arabia’s car industry as Hyundai and PIF partner on a major project in KAEC.

• Hyundai and Saudi Arabia’s PIF launch a joint venture for car production.
• Plant located at King Salman Automotive Cluster in KAEC.
• First vehicles to roll out in late 2026, with 50,000 units annual capacity.
• Project to boost local jobs, skills, and Saudi’s mobility sector.

Saudi Arabia has taken a big step in building its car industry with Hyundai Motor Company and the Public Investment Fund (PIF) officially starting construction on a major manufacturing plant.

This new factory, located in the King Salman Automotive Cluster at King Abdullah Economic City (KAEC), is the first Hyundai production site in the Middle East. The groundbreaking event marks a new era for Saudi Arabia’s automotive dreams, with strong focus on local development, job creation, and advanced manufacturing.

Partnership Breakdown and Factory Plan

Hyundai Motor Manufacturing Middle East (HMMME) is the official joint venture behind the project. PIF holds a 70% ownership stake, while Hyundai owns the remaining 30%.

The factory will focus on both internal combustion engine (ICE) and electric vehicle (EV) models. It aims to produce 50,000 vehicles each year, with the first car set to come out by Q4 2026.

The King Salman Automotive Cluster was chosen for its strategic location and access to global logistics routes. This will help Hyundai and Saudi Arabia connect easily with both regional and global markets, giving the project a strong base for long-term growth.

Key Benefits to Saudi Economy

• Creation of thousands of local job opportunities.
• Upskilling and training of Saudi workforce in automotive fields.
• Introduction of advanced manufacturing and mobility technologies.
• Boost to domestic vehicle production and reduced reliance on imports.
• Support for PIF’s vision of Saudi as a global automotive hub.

These benefits are in line with Saudi Arabia’s broader Vision 2030 goals, which aim to diversify the economy and grow non-oil sectors like industry and transport.

Strategic Value for Saudi Arabia

This project is not just about making cars. It represents a major shift in Saudi Arabia’s industrial capability and economic strength.

The factory is expected to act as a centre for technology transfer and innovation, giving Saudi talent access to international automotive standards and processes. This will improve local expertise and help build a strong support system for the future of mobility in the Kingdom.

The plant also supports PIF’s goal of positioning Saudi Arabia as a serious player in the global auto industry. By backing projects like HMMME, PIF is building a complete local ecosystem—from design and engineering to final assembly and export.

The Hyundai-PIF manufacturing plant is a key part of Saudi Arabia’s vision for industrial progress and global reach in the automotive world. With vehicle production starting in 2026, this move brings real momentum to the Kingdom’s efforts to grow its car industry.

It also offers a clear signal to global companies that Saudi Arabia is ready to be a serious manufacturing base. The new plant at KAEC is more than a facility—it’s a symbol of long-term transformation and new economic horizons.