First Automobile Plant in the Middle East

Officials from the Saudi Arabian government and Hyundai Motor Co. pose for a photo after signing an MOU on Jan. 1. 

Hyundai Motor Co. is expected to build a completely knocked down (CKD) plant in Saudi Arabia. If the company builds the plant as expected, it will be the first Korean automobile plant in the Middle East.

Hyundai Motor signed a memorandum of understanding (MOU) with the Ministry of Industry and Mineral Resources of Saudi Arabia to jointly nurture automotive industry in the Middle East country, according to foreign media reports on Jan. 1.

This MOU well matches Saudi Arabia’s national industrial strategy to enhance its manufacturing capabilities, the ministry said in its official SNS channel on the day.

A ceremony to ink the business agreement was attended by the Saudi Arian minister of industry and mineral resources, the Saudi Arian minister of economic planning and vice president Kim Seon-seop of Hyundai Motor’s Global Business Management Division.

According to local reports, Hyundai Motor and the Saudi Arabian government are expected to promote the establishment of a CKD plant in the country. Hyundai Motor is highly likely to build a CKD factory for internal combustion engine and electric vehicles. 

If Hyundai Motor builds the plant, it will be able to expand its presence in Saudi Arabia, the largest automobile market in the Middle East.

Hyundai Motor is working to expand sales and boost its brand awareness in the Middle East. In 2020, the Korean carmaker signed a contract to supply 1,000 new Sonatas as airport taxis to Al-Safwa, one of Saudi Arabia’s largest transportation companies.

Previously, Chung Eui-sun, chairman of Hyundai Motor Group, discussed business cooperation with Crown Prince Mohammed bin Salman of Saudi Arabia when he visited Korea last November.

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