Hyundai Breaks Ground on First Ever Car Factory in Saudi Arabia

Saudi Arabia : Hyundai has started building its first car plant in Saudi Arabia, and this marks a major breakthrough in the Kingdom’s auto manufacturing vision.

• The first-ever car plant in Saudi Arabia is at King Abdullah Economic City.
• The plant will produce 50,000 vehicles annually starting Q4 2026.
• Public Investment Fund holds a 70% stake, with Hyundai owning the remaining 30%.

Saudi Arabia’s Minister of Industry and Mineral Resources, Bandar bin Ibrahim Al-Khorayef, in a landmark announcement, confirmed that Hyundai has started the construction of its first car manufacturing plant in the Kingdom.

It is located in the King Salman Automobile Manufacturing Complex in King Abdullah Economic City, and it shows that the partnership between Hyundai and Saudi Arabia’s Public Investment Fund (PIF) is growing. The project is a key part of the national push to localize the production of automation and support long-term economic diversification.

A Bold Industrial Shift in the Region

Hyundai’s new facility is the first of its kind in the Middle East. It will cover 500,000 square meters and they expect it to produce 50,000 vehicles annually. They aim to begin production in the fourth quarter of 2026.

The plan of Saudi Arabia is to become a regional hub for car manufacturing, and this project is a strong pillar that supports that vision. Hyundai, through this plant, aims to tap into local demand and regional export opportunities.

Public Investment Fund holds a 70% stake in this collaboration and Hyundai Motor has a 30% stake. The focus of the facility is to build electric vehicles and modern automotive technologies so as to align with global trends in mobility.

Direct Goals and Economic Benefits

The project will:

• Add close to $5 billion to Saudi GDP by 2045.
• Strengthen local supply chains and industrial infrastructure.
• Create more jobs in many sectors.
• Position Saudi Arabia as an auto export hub in the region.

Voices from the Top

Emphasizing the Kingdom's goals, Minister, Al-Khorayef, said: “The Kingdom is confidently advancing towards localizing the automotive industry, creating added value for the national economy. This project represents an important milestone in our journey towards strengthening supply chains and developing local content to meet domestic and regional demand.”

Mohammed Al-Sheha, Director of the Automotive and Mobility Sector at PIF, explained the broader picture. “This plant is the third after the Lucid and Ceer factories. It is part of a wider plan to attract leading global car makers to set up in Saudi Arabia.” Al-Sheha also pointed to Hyundai’s strong presence in the country, with nearly 130,000 units sold last year, calling it proof that locals have strong trust in the brand.

Why This Move Matters for KSA

Hyundai has been present in the Saudi market for over 40 years. Today, it has the second-largest share in the Kingdom’s automotive sector. But this new plant marks a transformation.

Saudi Arabia is in a new industrial era, with major players like Lucid, Ceer, and now Hyundai operating under the same roof in the King Salman Complex. This move supports Vision 2030 and also fast-tracks it.