Industry PIF’s $550m Saudi facility to produce Pirelli tyres in 2026 By Pramod Kumar October 27, 2023, 5:29 AM Pirelli Tyre/X Pirelli tyres on display at the IAA Mobility car show in Munich last month. The facility will have an annual production capacity of 3.5 million units Local tyre brand to be launched Production to start in 2026 Location of factory not yet revealed Saudi Arabia’s Public Investment Fund (PIF) has signed a joint venture agreement with Pirelli of Italy to build a tyre manufacturing facility in the kingdom. The Riyadh-headquartered sovereign wealth fund will hold a 75 percent stake in the new $550 million JV, with Pirelli holding the remaining 25 percent. The Italian tyre manufacturer will provide both technical and commercial support. Italian companies urged to make Saudi their ‘second home’ PIF sets up unit to localise Saudi automotive sector PIF launches company to drive Saudi EV charging The plant, with an expected annual production capacity of 3.5 million units, will manufacture high-quality tyres for passenger vehicles under the Pirelli brand. It will also manufacture and market tyres under a new local brand for the domestic and regional markets. Production is expected to start in 2026, the companies said in a joint statement. However, the location of the site was not disclosed. Pirelli will become the first tier 1 tyre maker to directly source production in the kingdom. The closing of the transaction is subject to it receiving the necessary regulatory approvals. Yazeed Al Humied, deputy governor and head of Mena investments at PIF, said:“Through this JV with Pirelli, PIF is building production capabilities within the automotive and mobility value chain, enhancing opportunities for private sector contribution.” The PIF has been a significant player in pushing Saudi Arabia’s economic transformation and diversification as the country aims to become a global automotive manufacturing hub by 2030. The PIF and Hyundai Motor Company of South Korea recently announced a $500 million JV to establish an automotive manufacturing plant in the kingdom. Earlier this month, Tasaru, the National Automotive and Mobility Investment Company, was set up to localise automotive supply chains and manufacturing capabilities. PIF has already established Ceer, Saudi Arabia’s first national electric vehicle (EV) brand, and invested in the US-based EV maker Lucid Motors, which opened its first international manufacturing plant in the kingdom last month.
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