meed-logo

line1 line2 line3
SIGN IN / REGISTER

Region on the cusp of EV production boom

2 August 2024

 

Energy and economic diversification programmes, not to mention ambitious industrialisation plans, have spurred investments in domestic battery electric vehicle (EV) manufacturing and assembly.

As of July, in Saudi Arabia and the UAE there were at least seven projects related to the construction of EV manufacturing and assembly plants, and two schemes for facilities that will assemble or manufacture hydrogen-powered vehicles. These projects have a total combined capacity of close to 400,000 vehicles annually.

Those setting up their manufacturing and assembly lines in the Gulf states plan to produce EVs for domestic as well as export markets, mainly in Africa.

Each manufacturer targets a defined segment of the evolving market, from entry-level to high-end passenger vehicles and electric trucks.

Saudi sovereign wealth vehicle, the Public Investment Fund (PIF), is a partner and investor in three of these brands: US-headquartered Lucid Motors, Saudi Arabia's Ceer and South Korea’s Hyundai.

Construction work is under way for the SR5bn ($1.3bn) first phase of Ceer’s 170,000 vehicles-a-year production plant in King Abdullah Economic City (KAEC) in Jeddah.

Ceer is a joint venture of the PIF and Taiwan-based Hon Hai Precision Industry Company, which is also known as Foxconn.

Lucid Motors aims to capture the high-end market and is also building its first assembly plant in KAEC, targeting a production capacity of 5,000 cars a year. This will be expanded to 150,000 from 2025 to support the kingdom’s goal of producing 500,000 EVs, and for EVs to account for 30% of new car sales in Saudi Arabia, by 2030.

“We will be expanding rapidly into the other GCC states as well,” a Riyadh-based executive with the California-based EV startup tells MEED.

He says constant and rapid innovation, particularly in terms of battery and charging technologies, will likely provide the tipping point for many consumers to shift from internal combustion engine (ICE) vehicles to EVs.

“Our fast charger today requires no more than 12-13 minutes to get you 300 kilometres. This means you may need to charge your car only once a week for city driving.

“The Lucid Air Sapphire is also one of the most powerful sedans in production today, capable of hitting 100 kilometres an hour in around 2 seconds,” he adds.

In search of lithium

Today’s EVs run on lithium-ion batteries, and Australia, Chile and China dominate global lithium production. As such, securing a global supply chain for locally manufactured EVs has become a top priority for Saudi Arabia.

The kingdom’s Industry & Mineral Resources Minister Bandar Al-Khorayef travelled to the Chilean capital of Santiago in late July to meet with several ministers of the world’s second-largest lithium producer to discuss ways to bolster cooperation in the industrial and mining sectors and lithium production.

Alkhorayef also met with Ruben Alvarado, the chief executive of Chile’s main copper producer, Codelco, to discuss investment opportunities in mineral production, particularly lithium and copper.

According to industry experts, the potential deals that Alkhorayef planned to secure might not necessarily involve importing lithium from Chile to Saudi Arabia. Rather, they could pertain to Saudi Arabia wanting to establish an integrated vertical supply chain for industries that it plans to build that require the mineral.

Notably, Saudi Arabia is also exploring domestic lithium production.

Saudi Arabian Mining Company (Maaden) has undertaken a pilot project that successfully extracted lithium from seawater, although not at commercially viable levels.

In July, Maaden signed an agreement with US-based Ivanhoe Electric to explore the Arabian Shield zone in Saudi Arabia – which is approximately the size of Switzerland – for high-demand minerals, including lithium.

Australia-headquartered EV Metals Group has also announced the completion of an initial exploration programme at the Balthaga lithium project in Saudi Arabia. The project is located 450 kilometres east of Jeddah in the south-east of the Arabian Shield. 

Demand drivers

In addition to clear regulations, factors such as price competitiveness, a wider variety of EV models and innovative ownership models will be crucial in driving demand across the region, according to experts.

A study by global consultancy PwC suggests that there are just 56 EV models available in the UAE in 2024. This is equivalent to 7% of the total, with 731 ICE and hybrid models accounting for the rest.

This is in contrast to the trend in Europe, where there are 264 EV car models comprising 26% of the total. This ratio is expected to nearly triple to 71% by 2030.

“Consumers want what they want, not just what’s available,” says a senior business development executive with a UAE-based car distributor. “The younger consumers also do not want to own cars, they prefer a subscription model, so we need to cater to these requirements.”

Manufacturers and their local partners appear to be heeding these sentiments. Distributors in the UAE for leading brands including Tesla and BYD have launched car lease programmes, which allow consumers to make monthly payments over a fixed period, at the end of which they return the EV to the supplier.

This scheme suits consumers that want to upgrade their cars every few years and prefer the convenience of separate insurance and maintenance bills.

Major investments in local EV production, such as those being made in Saudi Arabia and the UAE, can also help to guarantee a greater variety of car models that are designed to cater to local preferences, weather and purchasing power.

 GCC ponders electric future

https://image.digitalinsightresearch.in/uploads/NewsArticle/12261174/main5816.jpg
Jennifer Aguinaldo

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • UAE to add Ajman to its Etihad Rail passenger network

    3 July 2026

     

    Register for MEED’s 14-day trial access 

    As part of ongoing procurement for the UAE’s national passenger rail rollout, Abu Dhabi’s Etihad Rail is adding Ajman to the planned network, extending coverage to five of the seven emirates.

    Etihad Rail tendered a design-and-build contract in late June to construct a section of the network to Hamriyah in Ajman, branching off from its existing freight network.

    The scope includes civil and track works, the construction of a passenger station and other associated infrastructure.

    Contractors have until 27 July to submit their proposals.

    The extension to Ajman brings Etihad Rail’s passenger network closer to the wider Northern Emirates, where Umm Al-Quwain and Ras Al-Khaimah still sit outside the current rollout, despite lying along the existing freight corridor, which currently terminates at Al-Ghail dry port in Ras Al-Khaimah.

    The sequencing of the Ajman section could pave the way for further extensions if this section proves successful.

    The latest development follows Etihad Rail’s start of passenger rail operations on 30 June 2026, with an introductory operational phase on the Abu Dhabi-Fujairah route.

    The passenger roll-out marked a major milestone for Etihad Rail, which was established in 2009 and tasked with delivering a roughly 900-kilometre railway linking key cities, ports and industrial hubs from Ghuwaifat to Fujairah on the eastern coast.

    The launch came less than five years after the UAE announced its ambition to create a national passenger railway under the country’s “Projects of the 50” programme, aiming to support economic diversification and sustainable development.

    According to Etihad Rail, passenger services will be introduced in planned phases through 2026 and 2027:

    • 23 June 2026: Passenger tickets went on sale via the Etihad Rail app and a dedicated booking website (as well as the contact centre for certain fares)
    • 30 June 2026: Introductory operational phase begins with services between Abu Dhabi and Fujairah only
    • 30 September 2026: Passenger rail services formally commence and expand to include Abu Dhabi, Dubai, Al-Dhaid and Fujairah
    • 30 December 2026: Services extend to Al-Dhafra stations
    • 30 March 2027: Services expand further to include Sharjah

    In response to MEED’s request for comment on the Ajman section, Etihad Rail said:

    “Etihad Rail remains committed to supporting the UAE’s vision for an integrated, efficient and sustainable transport network that enhances connectivity between communities and supports the nation’s long-term economic and social development.

    “As previously announced, Etihad Rail’s passenger services are being introduced in phases, with further expansion planned over time. We do not comment on market speculation, commercial discussions, procurement activity, or projects that have not been formally announced.

    “Any updates regarding future developments will be communicated through official channels in due course.”

    Passenger rail operations

    Tickets for the Abu Dhabi-Fujairah route are already on sale through the operator’s digital platforms.

    Customers can book tickets up to four weeks before travel. Tickets for new destinations will be released in line with the phased roll-out.

    At this point, Etihad Rail’s passenger service will officially connect 11 cities and regions across the UAE, supported by a station network that links key urban and economic centres. The station list includes:

    • Abu Dhabi – Mohamed Bin Zayed City Station
    • Dubai – Al-Yalayis Station
    • Sharjah – University City Station
    • Fujairah Station
    • Al-Dhaid Station
    • Al-Dhannah Station
    • Madinat Zayed Station
    • Liwa Station
    • Al-Mirfa Station
    • Al-Sila Station
    • Al-Faya Station
    Construction history

    The first phase of Etihad Rail comprised a 264-kilometre freight line spanning Shah, Habshan and Ruwais. This was primarily delivered by a consortium of Italy’s Saipem and Maire Technimont, alongside UAE-based Dodsal Engineering & Construction.

    Stage 2 of Etihad Rail comprises four major packages.

    India’s Larsen & Toubro worked with Chinese state-owned PowerChina International on the design and construction of freight facilities for Stage 2 under a AED1.87bn contract.

    A joint venture comprising China State Construction Engineering Corporation and South Korea’s SK Engineering worked on the first of four civil and track works packages for the 139km line between Ghuwaifat and Ruwais. The contract, worth AED1.5bn, was confirmed in March 2019.

    Packages B and C of Stage 2 were awarded to a joint venture of Beijing-based China Railway Construction Corporation and local Ghantoot Transport & General Contracting in June 2019.

    Both packages are understood to have a combined value of AED4.4bn and cover 310km of the rail network.

    In December 2019, a joint venture of CRCC and local National Projects & Construction was formally confirmed for the AED4.6bn Package D.

    Package D will link the ports of Fujairah and Khorfakkan to the network at the Dubai-Sharjah border and stretches over a distance of 145km.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17525193/main.jpg
    Yasir Iqbal
  • IHC deepens India links with $11.5bn aluminium venture

    3 July 2026

    Abu Dhabi’s International Holding Company (IHC) has struck its third major partnership with India’s Adani Group in a year, signing an agreement to co-develop an $11.5bn greenfield aluminium complex in the eastern Indian state of Odisha.

    Under a memorandum of understanding signed with the Odisha state government on 2 July, Adani Enterprises (AEL) and International Resources Holding (IRH), the natural resources investment platform IHC operates through its 2PointZero subsidiary, will form a 50:50 joint venture to build an integrated alumina and aluminium complex. The project comprises a 4-million-tonne-a-year (t/y) alumina refinery, a 2 million t/y aluminium smelter, a 4,000MW captive power plant and a 1 million t/y downstream manufacturing park.

    The deal marks Odisha’s largest foreign direct investment proposal to date and what the partners describe as India’s largest single foreign investment in the metallurgy sector. It is expected to create about 53,500 jobs, split between roughly 35,000 during construction and 18,500 in ongoing mining, refining, smelting and manufacturing operations once the complex is running.

    The tie-up extends a fast-growing relationship between IHC and Adani that began with a renewable energy joint venture between IHC subsidiary ePointZero and Adani Green Energy earlier this year. For IHC, which has built a $233bn portfolio spanning more than 1,300 subsidiaries across technology, infrastructure, financial services and consumer sectors, the Odisha project deepens a strategy of using IRH as a vehicle to secure positions across the minerals value chain underpinning the energy transition, moving beyond passive investment into direct industrial development.

    Odisha holds some of India’s largest bauxite reserves and is already a significant alumina and aluminium producer. State officials cast the project as central to plans to position the region as a global manufacturing hub, tying it to the state’s Samruddha Odisha 2036 development programme and the national Viksit Bharat 2047 agenda.

    The project will proceed in two phases. Following the MoU signing, AEL and IRH said they would move to land acquisition, statutory approvals and infrastructure planning alongside the Odisha government.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17539363/main.png
    Colin Foreman
  • Contractor wins Qiddiya Speed Park package deal

    3 July 2026

     

    Riyadh-based contractor El-Seif Engineering Contracting has won a contract to build the Exclusive Viewing Lounge (EVL) project in Qiddiya Entertainment City.

    Saudi gigaproject developer Qiddiya Investment Company (QIC) awarded the contract.

    The EVL comprises a four-storey structure designed for race-day viewing and guest hospitality. It will include dedicated spectator viewing areas, indoor lounge spaces, guest amenities and back-of-house service areas to support operations.

    Local firm Ammico Contracting carried out the project’s enabling works.

    The EVL is part of the Speed Park project at Qiddiya, which El-Seif Engineering Contracting and UAE-based Alec are jointly executing, as previously reported by MEED. The wider scope includes the construction of buildings around the racetrack.

    The racetrack is being delivered by local United Maintenance & Contracting Company (Unimac). In February 2024, MEED exclusively reported that QIC had awarded an estimated SR1.8bn ($480m) contract for the racetrack and associated infrastructure at Qiddiya’s Speed Park.

    The contract scope includes the track build and all infrastructure works, including electrical networks, storm drainage systems, water and sewer networks, landscaping, and associated underground and above-ground structures, along with related civil works.

    The Speed Park is being built around a Federation Internationale de l’Automobile (FIA) Grade 1 racetrack as part of the resort core in Qiddiya Entertainment City. Once complete, the circuit will be capable of hosting Formula 1 Grand Prix and motorcycling MotoGP races. 

    The Speed Park is one of several major projects within the greater Qiddiya development. Other projects include an e-games arena, the Prince Mohammed Bin Salman Stadium, a horse race venue, a performing arts centre, the Dragon Ball and Six Flags theme parks, and Aquarabia.

    The project is a key part of Riyadh’s strategy to boost leisure tourism in the kingdom. According to GlobalData, leisure tourism in Saudi Arabia has experienced significant growth in recent years.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17538940/main.jpg
    Yasir Iqbal
  • Local contractor wins DIFC tower contract

    3 July 2026

    Dubai-based contractor Al-Basti & Muktha has been awarded a contract to build the DIFC Heights Tower mixed-use development.

    The state-backed Dubai International Financial Centre (DIFC) awarded the contract.

    The project comprises a 43-storey building with 366 residential units, office space, and retail and food-and-beverage outlets. Construction is expected to commence shortly, with completion slated for 2029.

    Enabling works are under way and are being undertaken by Germany’s Bauer.

    Lebanese engineering firm Dar Al-Handasah is the lead and supervision consultant, while UAE-based Time is the project manager. Canadian engineering firm AtkinsRealis is the architect and concept designer, and local firm Omnium is the cost consultant.

    In a statement, DIFC said the project is being developed on the final remaining plot within its original land bank in the Gate District.

    Earlier this year, Dubai announced a AED100bn ($27bn) expansion of DIFC through the creation of the DIFC Zabeel District. A statement from the Government of Dubai Media Office said the new district will add more than 7 million square feet (sq ft), bringing total gross floor area to 17.7 million sq ft.

    The Zabeel District is expected to more than double DIFC’s capacity to more than 42,000 businesses, support a workforce exceeding 125,000, and allocate more than 1 million sq ft for future technologies and artificial intelligence. Planned in six phases, the expansion is scheduled to open to the public in 2030, with the masterplan due for completion in 2040.

    A bridge will link the DIFC Zabeel District to the existing DIFC Gate District.

    READ THE JULY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Stress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.

    Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17538278/main.jpg
    Yasir Iqbal
  • Iraq and Turkiye discuss oil pipeline deal

    3 July 2026

    Turkiye’s Energy Minister Alparslan Bayraktar has met with senior Iraqi oil and foreign ministry ‌officials to discuss energy cooperation, including on the Iraq-Turkiye Pipeline (ITP) that runs from Kirkuk to Ceyhan, according to a statement.

    In a post on social media, Bayraktar said that Turkiye aims to work closely with the new Iraqi government on more effective use of existing energy infrastructure.

    The decades-old agreement, which governs crude oil exports through the ⁠pipeline, is due to expire on 27 ​July.

    Baghdad and Ankara are still ​discussing a new draft agreement.

    Turkiye is ​also seeking ​to support ⁠existing infrastructure with new connections, Bayraktar said.

    Baghdad last month asked ​Ankara to extend the pipeline agreement ​for ⁠at least a year to allow time for more talks, but Ankara said ⁠it ​does not want an extension ​under current conditions.

    If the existing pipeline deal expires without Turkiye agreeing to an extension, it would be a major blow to Iraq, which has recently seen a large drop in crude exports due to disruption to shipping through the Strait of Hormuz.

    At the moment, in addition to transporting oil from northern Iraq, the ITP is also transporting crude from southern Iraq, which is brought to the north by truck and then injected into the pipeline network.

    At the end of March, Amer Khalil, the director-general of Iraq’s state-run North Oil Company, said that Iraq was exporting 200,000 barrels a day through the ITP.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17538073/main.jpg
    Wil Crisp