The Saudi Arabia automotive components market is entering a strong growth phas
The Saudi Arabia automotive components market is entering a strong growth phase, underpinned by Vision 2030 reforms, localization policies, and a gradual but clear shift toward advanced and sustainable mobility solutions. According to the report “Saudi Arabia Automotive Components Market, By Region, Competition, Forecast & Opportunities, 2020–2030F” recently added to ResearchAndMarkets.com, the market was valued at USD 6.51 billion in 2024 and is projected to reach USD 10.24 billion by 2030, registering a CAGR of 7.80% over the forecast period.
This momentum reflects a combination of higher vehicle ownership, expansion of the national vehicle park, rapid infrastructure development, and the government’s ambition to transform the Kingdom into a regional automotive manufacturing and logistics hub. At the same time, supply-side reforms are encouraging global OEMs and tiered suppliers to localize operations, strengthening the domestic ecosystem for automotive components across both OEM and replacement channels.
Vision 2030 and Localization: The Core Growth Engine
A central pillar of market expansion is Saudi Arabia’s Vision 2030, which aims to diversify the economy away from hydrocarbons and build competitive non-oil industries. Automotive and mobility have been identified as strategic sectors, and this is directly shaping the trajectory of the components market.
Industrial policy and factory base
Saudi Arabia’s Ministry of Industry reports an active and growing manufacturing base that includes around 160 automotive-related factories, among them 33 auto-parts plants and 21 engine/structure units. The long-term ambition is to scale up production capacity to 300,000 vehicles annually by 2030, with a local content target of around 50% in domestic vehicle sales.
This industrial push is being supported through:
- National Industrial Development and Logistics Program (NIDLP)
- Designed to accelerate growth in manufacturing, mining, energy, and logistics.
- Offers integrated support for domestic production, export development, and technology transfer.
- Positions Saudi Arabia as a logistics gateway connecting Asia, Europe, and Africa, which in turn benefits the component trade and re-export potential.
- Attractive investment incentives
- Tax exemptions and customs facilitation for priority industries.
- Soft loans and co-financing via government-backed funds.
- Subsidized or free industrial land in dedicated economic and industrial zones.
- Access to shared testing centers, research labs, and technology parks that reduce entry barriers for new component manufacturers.
- Public Investment Fund (PIF) as a mobility catalyst
- PIF is channeling capital into electric vehicles (EVs), smart mobility, and autonomous technologies, including investments in EV OEMs and related supply chains.
- These investments create opportunities for localized manufacturing of EV-specific components such as battery packs, power electronics, thermal management systems, and lightweight structures.
Collectively, these initiatives are nurturing a domestic supplier ecosystem that serves both vehicle assembly operations and the independent aftermarket, gradually reducing import dependence and creating demand for locally sourced, competitively priced components.
Ongoing Challenges: Import Dependence and Ecosystem Gaps
Despite the policy momentum, heavy reliance on imported components remains one of the most significant constraints facing the market. The domestic manufacturing base is still in an evolving phase, and a fully developed tier-1 and tier-2 supplier network is yet to materialize.
Structural reliance on imported components
Saudi Arabia continues to import a large share of its vehicle parts from major automotive exporting nations such as China, Japan, South Korea, the United States, and Germany, along with growing volumes from India, Thailand, the UK, Mexico, Canada, France, and Italy.
For instance, in 2023 the Kingdom imported:
- Around 117,565 kg of motor vehicle parts from India, and
- Approximately 113,324 kg from Thailand,
in addition to substantial quantities from other global suppliers.
This import dependence exposes the Saudi market to several risks:
- Global supply chain disruptions (like pandemics, shipping bottlenecks, or port congestion).
- Currency volatility that influences import prices and margins.
- Freight cost fluctuations, especially for bulky or sensitive components.
- Geopolitical tensions that may alter trade routes, tariffs, or export controls.
Domestic capacity and capability constraints
Progress on localization has begun, but the domestic ecosystem faces multiple challenges:
- Limited breadth of tier-1 and tier-2 suppliers:
Many local factories are focused on relatively standardized parts or assembly rather than high-value, precision components. - High capital intensity and long payback periods:
Greenfield component manufacturing requires heavy upfront investment in plant, machinery, tooling, and automation, which can deter private players. - Skills and know-how gap:
While the Kingdom is investing in vocational training and technical education, there is still a need for deeper expertise in advanced materials, process engineering, and quality management systems that meet global OEM standards. - Insufficient R&D and testing infrastructure at scale:
Advanced design, prototyping, and validation facilities are still limited, meaning many firms depend on foreign engineering support or imported designs.
As a result, meaningful localization is likely to be gradual, unfolding over the medium to long term rather than in the immediate future. Policymakers and industry stakeholders must therefore balance localization goals with the imperative of ensuring reliable component availability and competitive pricing for consumers and fleet operators.
Sustainability and Circularity: Emerging but Powerful Trends
One of the most dynamic shifts in the Saudi automotive components market is the growing adoption of sustainability and circular economy principles. This trend is closely aligned with national environmental commitments such as Vision 2030, the Saudi Green Initiative, and broader climate and emissions reduction targets.
Shift toward green materials and lightweight components
Automotive OEMs and suppliers operating in the Kingdom are increasingly:
- Exploring recyclable and lightweight materials, including:
- Aluminum and magnesium alloys for structural and body components.
- Carbon fiber and composite materials for high-performance and EV applications.
- Biodegradable or bio-based polymers for interior trims, panels, and non-structural parts.
- Focusing on weight reduction to improve fuel efficiency and extend the range of electric vehicles, which contributes to lower lifecycle greenhouse gas emissions.
These material shifts are expected to reshape the product mix in the components market, creating higher demand for advanced materials suppliers and specialty component manufacturers.
Rise of remanufacturing and refurbishment
A second key element of the sustainability trend is the increasing acceptance of remanufactured and refurbished parts, particularly in the replacement market. Components such as:
- Alternators
- Starters
- Clutch assemblies
- Brake calipers and systems
are increasingly being repaired, remanufactured, and reintroduced into the market as cost-effective, environmentally friendlier alternatives to new parts.
Workshops, independent garages, and fleet operators are gradually adopting:
- Component recycling and core-return programs
- Organized dismantling practices to extract usable parts from end-of-life vehicles
- Partnerships with specialized recyclers and technology providers to set up dismantling lines and parts recovery facilities.
Though still at an early stage in Saudi Arabia, this circular economy approach is expected to scale up over the next decade, particularly as regulatory frameworks tighten around waste management, emissions, and resource efficiency. Over time, this will likely foster a dual market: one for new components and one for remanufactured parts, each with its own pricing dynamics, quality standards, and service networks.
Competitive Landscape: Leading Global Players
The Saudi automotive components market features a mix of global tier-1 giants and regional suppliers. Many of the largest international companies are already active in the Kingdom, either through direct supply relationships, local distribution, or joint ventures.
Key players profiled in the report include:
- Robert Bosch GmbH – A leading supplier of powertrain components, braking systems, electronics, and sensors.
- DENSO Corporation – Strong in thermal systems, powertrain control modules, and advanced electronics.
- ZF Friedrichshafen AG – Known for transmissions, chassis systems, and driveline components.
- Toyota Boshoku Corporation – Focused on interior systems, filtration, and seating components.
- Magna International Inc. – A diversified supplier across body, chassis, seating, and powertrain modules.
- Valeo – Prominent in lighting systems, thermal management, and ADAS-related electronics.
- Hyundai Mobis – Provides chassis, electronics, and modules primarily to Hyundai-Kia networks.
- Mazda Motor Corporation – With an OEM presence that stimulates component demand through local dealer and service networks.
- Faurecia SE – Specialized in interiors, seating, and emission control technologies.
- Lear Corporation – A major player in seating and electrical distribution systems.
As localization advances, these companies are expected to deepen their regional footprint through partnerships, technology-sharing deals, and potentially local manufacturing units, especially for high-volume parts where local production offers a clear cost or logistics advantage.
Market Segmentation Overview
The report segments the Saudi Arabia automotive components market along four major axes: vehicle type, component type, demand category, and region. This structure helps stakeholders identify high-growth niches and tailor investments or market entry strategies accordingly.
1. By Vehicle Type
- Passenger Cars
- Includes small, midsize, and luxury cars and SUVs.
- Represents the largest share of component demand driven by rising household incomes, urbanization, and preference for personal mobility.
- The growth of premium and luxury segments also boosts demand for high-value components such as advanced electronics, ADAS modules, and upscale interiors.
- Commercial Vehicles
- Encompasses light commercial vehicles, trucks, and buses.
- Demand is closely linked to infrastructure projects, logistics expansion, e-commerce, and construction activity.
- Components for heavy-duty suspensions, driveline systems, braking systems, and fleet-grade electricals see particular traction.
2. By Component
- Engine Parts
- Internal combustion engine components such as pistons, valves, gaskets, and fuel systems.
- Still a sizeable segment given the dominance of ICE vehicles, but will gradually evolve as the country transitions toward cleaner powertrains and hybrid/EV platforms.
- Body & Chassis, Suspension & Brakes
- Structural components, subframes, bumpers, axles, suspension arms, shock absorbers, and braking hardware.
- Demand supported by high vehicle usage, rough operating conditions in certain regions, and regulatory emphasis on safety.
- Drive Transmission & Steering Parts
- Includes gearboxes, clutches, differential assemblies, drive shafts, steering racks, and related parts.
- Critical for both passenger and commercial segments and sensitive to driving patterns, fleet uptime requirements, and load profiles.
- Electrical Parts and Equipment
- Batteries, wiring harnesses, alternators, starters, lighting systems, and cockpit electronics.
- This segment is primed for rapid evolution with the growing penetration of electrified powertrains, ADAS, and connected vehicle technologies, which will significantly increase the electronic content per vehicle.
3. By Demand Category
- OEM (Original Equipment Manufacturer)
- Components supplied directly to vehicle manufacturers for fitment in new vehicles.
- Growth is aligned with local assembly projects, investments in EV platforms, and the success of industrialization initiatives under Vision 2030 and NIDLP.
- Replacement (Aftermarket)
- Parts supplied to service centers, independent garages, dealers, and retailers for maintenance, repair, and upgrades.
- This segment benefits from expansion of the vehicle parc, longer vehicle lifecycles, and increasing awareness of preventive maintenance among owners and fleet operators.
- The replacement market is also where remanufactured and refurbished parts are gaining ground, especially among cost-sensitive customers.
4. By Regio
- Northern & Central
- Includes Riyadh and surrounding areas; characterized by high vehicle density and strong demand for passenger car and light commercial vehicle parts.
- Hosts many government agencies and corporate fleets, supporting structured maintenance contracts.
- Eastern
- Anchored by the oil and gas sector and heavy industry, which drives demand for robust commercial vehicle components used in logistics and industrial transport.
- Ports in the Eastern Province also act as gateways for imported components and vehicles.
- Western
- Includes key cities such as Jeddah, Makkah, and Madinah, as well as major ports and tourism hubs.
- High passenger car density, significant rental fleets, and regional logistics routes create robust aftermarket demand.
- Southern
- A growing region with more challenging terrain in some areas, leading to higher wear and tear on certain vehicle systems.
- Offers long-term growth potential as infrastructure improves and economic activity deepens.
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