Discussions to grant the first permit to assemble cars in Saudi Arabia
The head of the National Industrial Clusters Program expects to start manufacturing in 2023
Friday – Rajab 11, 1441 AH – 06 March 2020 AD No. number [
Jeddah: Saeed Al Abyad
The National Industrial Cluster Development Program revealed that negotiations are now taking place with two of the largest companies in the auto industry, and if these negotiations succeed, the auto industry file will witness many developments in the current year 2020, which is a critical year in the auto industry.
Engineer Nizar Al-Hariri, head of the program, indicated that the first assembly permit will be granted to car companies in Saudi Arabia during the current quarter or next quarter, adding: “We plan to start construction of factories during the first quarter or next quarter, so that the beginning of manufacturing will take place in 2023 , Followed by the start of other business that includes manufacturing and compression. ”
He pointed out that «the challenge in the automotive industry is the supply chain, and we do not want to assemble cars only, but in the manufacture of components that require a strategy to activate all other industries, such as iron, aluminum, plastic, rubber tires and glass industries, and will open the door and many doors to invest in other sectors, It is thus a pivotal industry. The auto industry will open up to 6 other blocks in the auto supply chain. ”
And a large part of the assembly will be relied on, according to Al-Hariri. After these companies harmonize in the assembly period, which is estimated at two and a half years, other factories, such as aluminum, will be activated in coordination with the Industry and Logistics Development Program. There are discussions with large steel companies in Saudi Arabia to start working on sheet metal to enable the pressing process, which would raise the local content in the automotive industry to more than 60 percent.
In the aviation industry, Hariri said that industrial clusters work on several files with the two largest aircraft companies in the world, and we have local industries that can supply these companies with parts or parts of aircraft, and the program works with other parties in the industry and other organizations, to enable these factories to Qualification to supply these industries, pointing out that these industries have started operating in the local market.
Al-Hariri stressed that the program focused on four basic sectors in the beginning, including cars, petrochemicals, and mining, in addition to a moving file between solar energy and household appliances. The files were changing according to the needs of the sectors, noting that the pharmaceutical industries entered as a primary axis, with the vision of Crown Prince Mohammed bin Salman, while 6 new key sectors were added within the promising industries that include building materials, medical equipment, electrical equipment and machinery, and the energy industry in its comprehensive concept. Solar or even wind turbines, and also entered the aviation and food manufacturing industries.
And the group of industrial clusters – according to its head – began to put investors on the available and appropriate opportunities in all sectors, to show these industries as required, and in line with the vision of the Crown Prince, stressing that all sectors are working on them to activate and support the supply chain for these industries.
The speech of the head of the industrial clusters came during his meeting with a group of journalists on the sidelines of the “First Industrial Council of Jeddah” forum, which was sponsored by Bandar Al-Khareef, Minister of Industry and Mineral Resources, in which he indicated that Emiratisation in industries varies according to sectors, including the auto industry which aims to reach a rate of 40 In percent, what is open for export to some countries, such as North Africa, for example, because of agreements with Arab countries that require that the local content in the industries that are exported from cars or others be 40 percent, and if the percentage is less than that, we will face difficulties in Enter these markets, and And a target within the Convention.
He went back to emphasize that “the auto industry is not an easy industry; rather, it requires continuous research and development and experiments, and the start will be where others have ended, and we seek to have a global manufacturer with the ability to manufacture three lines, for the usual combustion engines, electric cars, and hydrogen cars,” explaining that no There is a desire to attract car companies that do not work on all lines, as 80 per cent of cars on the market are normal cars whose engines run in combustion.
He pointed out that «if we start the supply chain, then the transition to other future lines, with electric or hydrogen motors, will be easier. And about 70 per cent of the components of cars are similar, and if this rule is formed, the process of moving the type of engine from one line to another will be easier, ”explaining that industrial groups have human cadres capable of developing those groups and attracting industries and discussing investors, and then linking them with the Industrial Cities Authority, or The Royal Commission for Jubail and Yanbu, as well as King Abdullah Economic City as infrastructure, in addition to providing communication with the Industrial Development Fund and the Export Authority.