The agreement between SABIC and the PIF-Pirelli Joint Venture is a strategic cornerstone for the King Salman Automotive Cluster. Saudi Arabia is moving from consumer to manufacturer. There will be a supply of raw material like butadiene rubber and carbon black. SABIC has local chemical expertise, while Pirelli has global high technology. Together, they will make a large scale manufacturing hub for the region.
 |
| Image Courtesy: SABIC |
Project Specifications:
| Feature | Details |
| Annual Capacity | 3.5 Million Tires |
| Location | King Abdullah Economic City (KAEC) |
| Target Markets | Passenger vehicles and regional OEMs |
| Key Raw Materials | Synthetic rubber (Butadiene) and Carbon Black |
Partnership Breakdown:
| Entity | Stake | Primary Role |
| PIF | 75% | Majority shareholder and investment lead. |
| Pirelli | 25% | Technology partner; technical and commercial assistance. |
| SABIC | N/A | It is primary supplier of raw materials like Butadiene & Carbon Black. |
This project is located in King Salman Automotive Cluster. There are many developments there like Ceer (Saudi Arabia's 1st EV giant), Lucid Motors, and Hyundai manufacturing plan. This deal directly supports Vision 2030, as Saudi Arabia has goal to produce 50% of its automotive parts locally.
Impact of This Deal:
- This deal will grow non-oil GDP of Saudi Arabia as companies in King Salman Automotive Cluster will make SAR 92 billion to GDP in 2035.
- It will reduce import cost. Saudi Arabia will manufacture here.
- It will create thousands of direct and indirect jobs for Saudi nationals.
- Construction, logistics, and secondary services demand will boom and it will create ripple effect in economy.
Post a Comment