Hyundai Motor has begun construction of its first manufacturing facility in the Middle East, staking a claim in Saudi Arabia’s ambitious push to develop a domestic automotive industry.
The South Korean automaker held a groundbreaking ceremony on May 14 for Hyundai Motor Manufacturing Middle East (HMMME) at the King Salman Automotive Industrial Complex in King Abdullah Economic City. The joint venture pairs Hyundai with Saudi Arabia’s Public Investment Fund (PIF), which holds a controlling 70 percent stake while Hyundai maintains 30 percent ownership.
Set to begin operations in the fourth quarter of 2026, the plant will produce up to 50,000 vehicles annually, including both electric vehicles and internal combustion models. The project represents a strategic move into a market where Hyundai already has significant presence, with Saudi Arabia accounting for more than half of its sales across 14 Middle Eastern countries.
For Saudi Arabia, the facility aligns with its Vision 2030 initiative to diversify beyond oil dependency. The kingdom aims to produce 500,000 electrified vehicles annually by the end of the decade while converting over 30 percent of vehicles in Riyadh to electric.
The groundbreaking ceremony drew more than 200 attendees, including Chang Jae-hoon, Hyundai Motor Group vice chairman, and Bandar Ibrahim Al-Khorayef, Saudi minister of industry and mineral resources.
Saudi Arabia represents approximately 34 percent of the Middle Eastern automotive market, with 840,000 vehicles sold in the country last year out of 2.49 million across the region.
