Electric vehicle industry in the Kingdom – Al-Madina Newspaper

The recent announcement of the launch of the first Saudi company to manufacture electric cars in the Kingdom came as a translation of decades-old aspirations, especially in light of the large market size, the availability of raw materials and the strategic location , as well as the nature of the car, which is characterized by low cost and maintenance Clean energy, the reduction of carbon emissions and the preservation of the environment in order to promote sustainable development.

The Saudi industrial strategy gives priority to about 12 sectors, including the automotive industry, as the beginning was with the laying of the foundation stone for the Lucid factory in Jeddah, and then the announcement of the Saudi brand for the manufacture of electric cars, ” Sir”.

Saudi Arabia’s entry into the automotive industry is a project that has been anticipated for decades, but it is now at the heart of the national strategy for the industry, which was approved by the Council of Ministers last month.

The local market provides a ground for the introduction of the automotive industry before it is launched for export. By 2030, the share of traditional cars powered by internal combustion engines is expected to drop to 49%, compared to 30% for hybrid cars and 21% for electric cars.

It is characterized by agility and low cost

Electric motors have a range of advantages, especially working with electric motors, therefore there is no need for engine lubrication or anything related to the combustion engine or many maintenance tasks usually associated with a gas engine.

Although electric cars are much more expensive than similar gas-powered models, less money will be spent to keep them on the road. The biggest cost for electric cars is the eventual need to replace the battery.

These cars do not need fuel, the price of which has increased at a global level with the energy crisis. In a world full of increasing greenhouse gas emissions, electric vehicles are a much-needed achievement.

The use of electric vehicles can reduce the carbon footprint and emissions of dangerous gases such as carbon monoxide and nitrogen oxides. Recharging an electric car is as easy as recharging a mobile phone from home.

And since there is no exhaust system, electric cars are known to run smoothly and quietly.

The electric crossover and SUV models are quieter than conventional gas engines, resulting in less noise pollution and increased ride comfort. Electric cars also tend to be much more responsive than mechanical cars providing more torque and agility while driving.

Import of 320,000 cars in 6 months

The Zakat, Taxation and Customs Authority revealed that the Kingdom imported about 320 thousand cars during the first half of this year, which is equivalent to 57% of the imports of the whole of last year.

The number of vehicles imported into the Kingdom during 2021 amounted to around 562,000 vehicles.

According to the authority, the main importing countries are Japan, America, South Korea, Thailand, Germany, China, India, Indonesia, the United Kingdom, Taiwan, Mexico, the Czech Republic, Italy, Turkey and France, and it is allowed to to import vehicles provided their model does not exceed 5 years in respect of small cars, buses and light transport (3.5 tonnes or less) and 10 years for heavy transport trucks “over 3.5 tonnes”, and this is calculated in descending order except for the current year.

Although it is prohibited to import salvage vehicles that have been subjected to drowning, accident, fire, overturning or damage to the structure, according to the result of the investigation.

Establishment of two factories for electric cars with a capacity of 300,000 cars

The national strategy for the industry aims to establish two electric car factories in the Kingdom with an annual production of 300,000 cars. The foundation has already been laid for the Lucid factory which will produce 150,000 cars. The “Sir” brand of the Public Investment Fund was also launched.

The automotive industry strategy will not stop at assembly, but instead includes 13 components that enter the different levels of the supply chain, starting with seats, tires, air conditioning and heating systems, up to glass, lithium batteries and engines, and this is what qualifies Saudi Arabia to become a regional center for the automotive industry and its components.

It is expected that “Sir” will attract foreign direct investment worth 562 million riyals to support the national economy, and its direct contribution to the gross domestic product will reach 30 billion riyals, while by 2034 it will create 30,000 jobs directly and indirectly supply.

Seener will work within the strategy of the Public Investment Fund, as the company will design, manufacture and sell electric cars equipped with advanced technical systems, such as self-driving, in the Kingdom and the Middle East region, including sedans and SUVs.

The “Sir” company is a joint venture between the Public Investment Fund and the “Foxconn” company, where “Sir” will obtain licenses for the technology of components related to electric cars from “BMW” for use in the development of vehicles , while “Foxconn” will develop the electrical system for cars, which will be designed and manufactured entirely in the Kingdom, and the cars will undergo quality checks according to the highest international standards, and it is scheduled that the “Mr” cars will be available will be for sale during the year 2025.

Availability of raw materials for the industry

The head of the National Industry Committee, Ibrahim Al-Sheikh, said that the automotive industry is witnessing a radical change by switching to electric or hybrid cars, and the opportunity is ripe for the Kingdom to become a pioneer in this industry and has the ingredients for success that the state is betting on.

According to Al-Sheikh, in press releases, possible raw materials for the automotive industry, such as aluminum, specialized plastics, industrial fluff and glass, are available to take advantage of to achieve success and localize the industry. He believed that the basis for the success of the automotive industry depends on its complementary industries, and the first challenge is to provide the first and second lines of production raw materials as raw materials and investment, and it is available, and the Kingdom does not have manufacturing not. experience.

The Kingdom’s logistics location is also strategic and enables it to supply cars at competitive prices, especially since part of the raw materials included in the car industry in various countries in the region are from Saudi companies. And reduce emissions to zero by 2060, coinciding with the world’s transformation and targeting zero conventional cars in light of demand rates that have reached 550,000 cars annually.

Manufacturing of automotive parts in the Kingdom

60% of the parts of some cars are currently produced in the Kingdom, including the entire interior parts, in addition to tires, glass and bumpers, while 44 billion riyals have been allocated to support the automotive industry within the National Industrial Program. According to the director of the Saudi-Japanese Institute in the Kingdom, the Kingdom excelled in assembling years ago as a first step for manufacturing, explaining that covering the local need for cars depends on the actual start of manufacturing first, provided it includes all car structures and parts and work, starting with areas of need in big cities and then the rest of the cities. .

After the internal self-needs have been met, exports are seriously considered, starting with the neighboring Gulf countries, and then other Arab countries.

He called for relying on skilled national hands and experienced foreign hands with vast experience, including non-Saudis working in the Kingdom or being recruited for this purpose. One of the main challenges of the industry is the cost of labor and the very complex nature of the industry.

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