Saudi Arabia’s Public Investment Fund (PIF) collaborates with Pirelli Tire S.P.A (Pirelli), one of the world’s premium tire manufacturers. They have entered into a joint venture, committing $550 million towards the establishment of a sophisticated tire manufacturing facility in Saudi Arabia.
PIF will embrace a commanding role, wielding a 75% stake in the venture, with Pirelli contributing the remaining 25%. As a strategic technology ally, Pirelli will funnel its esteemed expertise and resources into the project, ensuring a harmonious blend of technical innovation and commercial robustness.
Projected to commence production activities by 2026, the facility is designed to be a crucible of quality and innovation. It aims to manufacture premier tires for passenger vehicles adorned with the reputable Pirelli brand, while also cultivating a new local brand to resonate with the domestic and regional market’s unique preferences.
The overarching vision propelling this venture is to elevate Saudi Arabia to the zenith of global automotive manufacturing by the year 2030. PIF has been instrumental, in orchestrating transformative investments that amplify the nation’s manufacturing proficiencies and infrastructural fortitude, fostering a conducive environment for automotive excellence beyond its borders.
This alignment of strategic objectives has already birthed fruitful collaborations, evidenced by PIF’s remarkable $500 million joint venture with Hyundai Motor Company, marking a significant infusion of investment and opportunity into Saudi Arabia’s burgeoning automotive sector.
PIF’s diversified investment portfolio also illuminates its future-forward approach, with remarkable undertakings such as the launch of Ceer, Saudi Arabia’s premier national electric vehicle brand, and substantial investment in Lucid Motors, amplifying the kingdom’s footprint in the electric vehicle domain.
Pirelli, revered globally for its tire manufacturing prowess, will act as a cornerstone, providing essential technical guidance to meticulously craft, nurture, and operationalize the plant. This fusion of global mastery and local insights seeks to herald a new epoch in automotive manufacturing, fostering an ecosystem ripe with innovation and growth opportunities.
A commitment to environmental stewardship pervades the venture’s ethos, aiming to realize an impressive annual production output of 3.5 million units, intertwined with a profound respect for sustainable practices. This symbiosis of economic vigor and ecological consciousness aims to amplify the venture’s appeal and influence, attracting further global investments.
The narrative of Pirelli’s involvement is also marked by a significant milestone as it becomes the pioneer tier 1 tire manufacturer to anchor its production capabilities directly within Saudi Arabia, symbolizing a harmonious confluence of global expertise and local opportunity.
Celebrating the venture’s promise, Yazeed A. Al-Humied, Deputy Governor and Head of MENA Investments at PIF, articulates a vision of economic diversification, enhanced sustainability, and the flourishing of localized manufacturing expertise in Saudi Arabia’s evolving landscape.
On the world stage, Marco Tronchetti Provera, Executive Vice Chairman of Pirelli, reveres the venture as a treasure trove of opportunity, viewing Saudi Arabia as an emerging bastion of immense potential in the realms of high-value and electric automotive innovations.
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