Saudi Arabia prepares to build its first car manufacturing plant

The Saudi Authority for Industrial Cities and Technological Regions (SACTR) has reached an agreement with the Gulf Automobile Manufacturing Company to set up a car manufacturing plant in the eastern Gulfside Saudi city of Dammam.

In its initial phase, the plant will be able to produce 15,000 cars per year. According to Toufique Al-Rabeea, the director general of SACTR, the plant will be set up with a capital of SR375 million (US$100 million), and will be shifted in its second phase to the industrial city in Sudair where three million square metres would be allocated to the facility, which will then have in its second phase a planned production capacity of 300,000 cars per year.

The plant could start operations as early as next year. Saudi Arabia imports vehicles worth more than SR22 billion [$5.9 billion] annually, and current forecasts predict a 27% increase in car sales in 2008 year on year.