Meed | Region on the cusp of EV production boom

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

Exclusive from Meed

Saudi Arabia raises electricity tariffs
26 October 2026
Dubai Municipality confirms AED3bn Tasreef drainage awards
26 October 2026
Nakheel awards $259m Dubai Islands buildings contract
26 October 2026
Morocco plans second high-speed rail phase to Agadir
26 October 2026
Riyadh tenders King Salman Stadium works
26 October 2026

Saudi Arabia raises electricity tariffs
26 October 2026

Saudi Energy, formerly Saudi Electricity Company, has announced revised electricity tariffs, which will take effect on 1 January 2027.

The revised tariff schedule, published on the company’s official website, covers residential, commercial, industrial, agricultural, charitable and government customers.

The largest percentage increase in consumption rates is 16.7%, for residential customers using up to 6,000 kilowatt-hours (kWh) a month. Residential customers will pay 21 halalas/kWh for monthly consumption of up to 6,000kWh, up from 18 halalas. For consumption above 6,000kWh, the rate will rise from 30 to 33 halalas/kWh, a 10% increase.

The industrial tariff will increase by 15%, from 20 to 23 halalas/kWh. Commercial customers, private healthcare facilities and private educational facilities will pay 25 halalas/kWh, up from 22 halalas, for consumption up to 6,000kWh a month, and 35 halalas/kWh above that level, up from 32 halalas.

Tariffs for charities and government customers will also increase. In addition to consumption-based charges, customers will pay a fixed monthly fee based on the capacity of their electricity meter. This replaces the previous separate charge for meter reading, maintenance and billing, with VAT applied to the revised tariffs.

Electricity investment

The new tariffs coincide with changes to water consumption tariffs announced by the National Water Company, also effective from 1 January 2027.

King Salman Bin Abdulaziz Al-Saud directed support measures following a proposal presented by Crown Prince and Prime Minister Mohammed Bin Salman Bin Abdulaziz Al-Saud.

This includes raising the minimum wage required for Saudi nationals to count as full employees towards private sector localisation quotas under the Nitaqat programme.

The tariff changes come as Saudi Arabia plans substantial investment in its electricity infrastructure. In September 2025, Saudi Energy announced plans to invest SR220bn ($58.7bn) in power infrastructure projects between 2025 and 2030.

A June 2025 report by Fitch Ratings forecast negative free cash flow of about SR16bn a year over the period and rising leverage, reflecting the financial demands of the programme.

https://image.digitalinsightresearch.in/uploads/NewsArticle/20924301/main.jpg

Mark Dowdall
Dubai Municipality confirms AED3bn Tasreef drainage awards
26 October 2026

Dubai Municipality has confirmed it has awarded four contracts worth AED3bn ($817m) to expand the emirate’s stormwater drainage network by about 100 square kilometres under phase three of the Tasreef programme.

The projects will cover Jumeirah, Umm Suqeim, Al-Quoz, Al-Barsha, Al-Wasl and Al-Marmoom. The works include constructing and extending main stormwater drainage lines with diameters of up to three metres.

The four packages are part of Dubai’s AED30bn Tasreef programme, which aims to increase the emirate’s stormwater drainage capacity by 700% and reduce costs associated with pumping stations, network operations and maintenance by 20%.

The contracts have been awarded to China State Construction Engineering Corporation (CSCEC) and three local firms: Arifco Group, Nael Construction & Contracting (NCC) and Detech Contracting. Dubai Municipality did not state which projects the awards relate to.

According to sources, the contract awards include packages TF-15-C1, TF-15-C2 and TF-13-C1.

The first package, TF-15-C1, involves the construction of 21 kilometres of main and secondary drainage lines along Al-Wasl Road and in surrounding areas. It will cover Za’abeel 2, Al-Wasl, Jumeirah 1 and 2, Al-Bada’a, Al-Satwa and Dubai World Trade Centre. The estimated $100m contract was awarded to Detech in July, as exclusively reported by MEED.

The second package, TF-15-C2, covers the corridor between Sheikh Zayed Road and Al-Khail Road. It includes about 14km of main drainage lines serving Al-Quoz Industrial Areas 1, 3 and 4, and Al-Barsha 1. In July, MEED reported that CSCEC had won the engineering, procurement and construction contract for this project.

The third package, TF-13-C1, covers Al-Marmoom, where 23km of drainage infrastructure will be developed. According to a source, Arifco has been awarded this contract.

The final package covers Jumeirah and Umm Suqeim, where about 42km of main drainage lines will serve Umm Suqeim 1, 2 and 3; Umm Al-Sheif; Jumeirah 3; Al-Safa 1 and 2; and Al-Manara.

In May, MEED reported that NCC had been awarded a contract to build a sewage and stormwater drainage system, DS-204. However, it is unconfirmed whether this relates to the same project.

Earlier, in February, the municipality confirmed it had awarded contracts for five new projects under phase two of the programme to expand and strengthen Dubai’s stormwater drainage network.

These included two contracts awarded to Detech and one to CSCEC for stormwater drainage infrastructure. In addition, two consultancy contracts were awarded for the study and design of drainage systems in selected areas across the emirate.

Cumulatively valued at AED2.5bn, the new projects will serve 30 vital areas, spanning approximately 430 million square metres and supporting an estimated population of three million residents by 2040.

Previously, in April 2025, an earlier package of awards was announced under phase one of the Tasreef programme. The overall masterplan aims to expand Dubai’s rainwater drainage capacity by 700% by 2033.

https://image.digitalinsightresearch.in/uploads/NewsArticle/20923924/main4827.jpg

Mark Dowdall
Nakheel awards $259m Dubai Islands buildings contract
26 October 2026

Dubai-based master developer Nakheel, part of Dubai Holding Real Estate, has awarded local firm Parkway International Contracting a construction contract valued at about AED950m ($259m) for phases two and four of Bay Grove Residences on Dubai Islands.

The package covers 617 residential units across eight buildings, ranging from one to four bedrooms, together with basement structures, infrastructure and community amenities including swimming pools, sports courts and fitness centres.

Phase two comprises 360 homes across four buildings, with main construction scheduled for completion in late 2028.

Phase four includes 257 homes across four buildings, with completion targeted for the second quarter of 2029.

The award follows an earlier contract valued at about AED800m ($218m) awarded to local contractor Metac General Contracting Company for phases one and three, covering 537 homes across seven buildings.

Together, the two contracts total more than AED1.75bn ($476m) and account for all 1,154 planned homes across the 15 buildings of Bay Grove Residences.

Project activity on Dubai Islands has gathered pace in recent months. Earlier this month, Nakheel awarded local firm Mar Marine & Building Contracting a contract for marine and coastal works on Island B. The scope includes constructing breakwaters, removing existing rock revetments and creating a new 320-metre beach near the Bay Villas development, as well as remedial and refurbishment works along approximately 3 kilometres of the island’s western shoreline.

In August 2025, Nakheel awarded Fibrex Contracting a AED2.6bn ($708m) construction contract for the Bay Villas residential project. That followed a AED527m ($143m) contract awarded to Al-Nasr Contracting Company in April 2026 for primary infrastructure and utilities on Island B.

https://image.digitalinsightresearch.in/uploads/NewsArticle/20923389/main.jpg

Yasir Iqbal
Morocco plans second high-speed rail phase to Agadir
26 October 2026

Morocco has outlined a second rail investment cycle for 2030-35, which includes beginning construction of a high-speed rail extension from Marrakech to Agadir and connecting Essaouira to the national rail network.

The pipeline forms part of the government’s 2026-31 programme, presented to parliament last week.

The Marrakech-Agadir link is estimated to cost close to MD55bn ($5.5bn) and will cover a 240-kilometre (km) route through the High Atlas Mountains via Chichaoua. Civil engineering structures, including tunnels and viaducts, are expected to account for nearly 70% of the alignment.

In September, the government issued a decree declaring the Marrakech-Agadir and Chichaoua-Essaouira rail corridors to be of public utility, paving the way for land acquisition and expropriation procedures.

Under the long-term masterplan Plan Rail Maroc 2040, Essaouira is expected to connect to the network via a separate line branching off at Chichaoua, designed for operating speeds of up to 200km an hour. The mainline to Agadir is designed for speeds of up to 320km/h.

The 2030-35 cycle also includes rehabilitating the Casablanca-Khouribga-Oued Zem line; constructing a new line between Oued Zem and Beni Mellal via Bejaad, with a branch to Fquih Ben Salah; doubling and upgrading the 140km Benguerir-Safi line; expanding capacity on the Fez-Oujda corridor; and building new-generation passenger stations.

The plans follow Morocco’s ongoing MD134bn ($13.4bn) 2024-30 rail investment programme, which focuses on completing the Kenitra-Marrakech high-speed line ahead of the 2030 Fifa World Cup.

The programme also includes developing regional express network services across five regions, electrifying the Fez-Oujda line and completing a freight rail link to the Nador West Med port.

Work on the Kenitra-Marrakech line had reached about 30% by May 2026, with commercial services targeted to begin in September 2029.

https://image.digitalinsightresearch.in/uploads/NewsArticle/20920349/main.jpg

Yasir Iqbal

Riyadh tenders King Salman Stadium works

26 October 2026

Register for MEED’s 14-day trial access

Saudi Arabia’s Sports Ministry has tendered a contract covering early works at King Salman International Stadium in Riyadh.

The scope includes enabling works, site preparation and initial construction activities.

The tender was issued on 11 October, with a submission deadline of 19 November.

The stadium will cover about 660,000 square metres (sq m) and seat 92,000. Facilities will include a 150-seat royal suite, 120 hospitality suites, 300 VIP seats and 2,200 dignitary seats.

The wider development will include sports facilities covering more than 360,000 sq m, including two training fields and fan zones; a closed sports hall; an Olympic-sized swimming pool; an athletics track; and outdoor courts for volleyball, basketball and padel.

The stadium is set to host the final of the 2034 Fifa World Cup and will serve as the Saudi national football team’s main base.

US-based architectural firm Populous is the lead architect for the stadium.

Construction of the stadium is expected to be completed by 2029.

The stadium will be located next to King Abdulaziz Park.

Firms submitted prequalification statements for the main design-and-build contract in February.

Saudi stadium plans

In August 2024, MEED reported that Saudi Arabia planned to build 11 new stadiums and refurbish four facilities for the 2034 Fifa World Cup.

Eight stadiums will be located in Riyadh, four in Jeddah and one each in Al-Khobar, Abha and Neom.

A further 10 cities will host training bases: Al-Baha, Jazan, Taif, Medina, Alula, Umluj, Tabuk, Hail, Al-Ahsa and Buraidah.

There are expected to be 134 training sites in the kingdom, including 61 existing facilities and 73 new venues.

Saudi Arabia was officially selected to host the 2034 Fifa World Cup during an online convention of Fifa member associations at the Fifa Congress on 11 December 2024.

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