Saudi Arabia Emerging as Major Regional Car Hub
The U.S.-Saudi Arabian Business Council (USSABC) is set to host a conference, titled ” Saudi Arabia: New Auto Market Hub for the Middle East, Africa, and South Asia”, this summer in Birmingham, Michigan. The program will bring together senior Saudi Government officials, major Saudi industrialists, and leading OEMs to highlight the advantages of doing business in the Middle East’s largest car market.
The Saudi Government has taken a number of steps to build an automotive cluster in the country. Isuzu of Japan is already assembling light trucks in Saudi Arabia and Jaguar/Land Rover has recently signed a letter of intent to build a manufacturing plant as well. Low energy costs, a pro-business environment, and the availability of raw material inputs for vehicle “lightweighting” are drawing the attention of OEMs and automotive component suppliers worldwide.
Reducing vehicle weight to meet rising fuel efficiency targets is a priority among most auto manufacturers. Lightweight plastics and aluminum are key material inputs for this effort. Saudi Arabia is home to the Saudi Basic Industries Corporation (SABIC), a major player in automotive plastics technology, and also boasts one of the world’s largest integrated aluminum production facilities, a joint venture of Alcoa and Ma’aden, a key Saudi Arabian mining corporation.
Rising car sales in Saudi Arabia and other emerging markets in the region has also put the country on the map for OEMs looking to tap into new growth opportunities. Saudi Arabia’s vehicle sales totaled 759,000 in 2011 and are expected to pass the 1 million per year mark by 2018. The country also has tariff free access to the 1.2 million annual auto market of the Gulf Cooperation Council (GCC) nations and has access to more than 400 million consumers in the Middle East and North Africa (MENA). The powerhouse market of South Asia – approximately one-fifth of the world’s consumers – is within reach by air and sea.
Confirmed speakers for the event include H.E. Dr. Tawfig Alrabiah, Saudi Minister of Commerce and Industry; Eng. Mohamed Al-Mady, Saudi Arabian Co-Chairman of the USSABC and Vice Chairman and CEO of SABIC; Mr. Peter Robertson, U.S. Co-Chairman of the USSABC and former Vice Chairman of Chevron Corporation; and Eng. Azzam Shalabi, President, National Industrial Clusters Development Program. Invited speakers also include representatives from the Royal Commission for Jubail and Yanbu, General Motors, Isuzu, and Land Rover.