JEDDAH, 11 May 2003 — There is now an organized move to develop an auto parts industry in Saudi Arabia.
“We’re keen to develop a domestic auto parts manufacturing industry to meet rising demand,” an industry leader said.
“The Kingdom is keen to attract more foreign investment and create jobs for young Saudis,” Mohammed A. Al-Nutaifi, marketing consultant at Saudi Industrial Development Fund’s (SIDF) Projects Department, said.
“SIDF is offering subsidized loans and other incentives, such as low cost energy and services and tax breaks, to foreign companies willing to establish factories to meet the huge domestic demand for vehicle components and accessories.”
According to industry figures, the Kingdom is the Middle East’s biggest importer of vehicle components and accessories, especially automobile parts, tires, batteries and garage equipment. There are over six million vehicles in the Kingdom and its automotive imports, excluding tires, exceeded $665 million last year.
The Middle East’s market for automobile spare parts and accessories is estimated at $8 billion and growing annually at six percent.
Al-Nutaifi presented an overview of the emerging auto parts industry in the Kingdom during the three-day Automobile Aftermarket Middle East (AAME) 2003 which ended in Dubai over the weekend. “With better servicing facilities, Saudi car owners are keeping their vehicles longer and with the increase in vehicle life, the market for spare parts, particularly brakes and batteries, is experiencing double digit growth.
“Last year, replacement vehicle components accounted for over 60 percent of automotive imports,” he said.
