Saudi Aramco inks deal to invest in Geely-Renault engines venture
RIYADH: Oil giant Saudi Aramco is preparing to join carmakers Geely and Renault in a new joint venture in hybrid and internal-combustion vehicles, the three firms said Thursday.
RIYADH: Oil giant Saudi Aramco is preparing to join carmakers Geely and Renault in a new joint venture in hybrid and internal-combustion vehicles, the three firms said Thursday.
Aramco has signed a letter of intent “to become a potential minority stakeholder” in the subsidiary, the joint statement said.
French automaker Renault said in November it was teaming up with China’s Geely to develop and produce engines, gearboxes and other components for hybrid, petrol and diesel vehicles.
The 50-50 partnership called “Horse” was announced as part of a sweeping overhaul at Renault as it expands its electric vehicle business. Aramco’s investment will “contribute to key research and development across synthetic fuels solutions and next-gen hydrogen technologies”, according to the statement.
Renault chief executive Luca de Meo said the Aramco partnership would give the joint venture “a head start in the race towards ultra-low-emissions ICE (internal-combustion engine) powertrain technology”.
“Aramco’s entry brings to the table unique know-how that will help develop breakthrough innovations in the fields of synthetic fuels and hydrogen,” de Meo said in the statement. The new “Horse” subsidiary will have 19,000 employees in Europe, China and South America, with 17 factories and five shared research and development centers. Saudi companies to invest $51 billion under government-backed plan.
Meanwhile, Saudi Arabia has launched $51.2 billion of investments led by local companies, including oil giant Aramco, Sabic and Maaden, under a government-backed initiative, state news agency SPA reported.
The projects are part of a program called Shareek, a 5-trillion-riyal investment initiative announced by Saudi Crown Prince Mohammed bin Salman in 2021, as the kingdom works with the private sector to diversify away from oil by 2030. The program has approved the first batch of projects, including five investments by Aramco in petrochemicals, cloud computing and ship engines, SPA reported, citing a statement from Abdulaziz Al-Arifi, the chief executive of Shareek.
ACWA Power will get backing to build the world’s largest green hydrogen plant, Ma’aden will receive support to boost production of phosphate fertilizers and SABIC will build the kingdom’s first catalyst manufacturing hub, SPA added. Other investments in the telecommunications and logistics will also receive Shareek support.
Prince Mohammed had announced 12 trillion riyals of investments that the kingdom is planning by 2030, which include the Shareek program, 3 trillion riyals from the Public Investment Fund (PIF) and 2 trillion in foreign investment. As part of the plans, officials have also pressed international companies to invest in Saudi Arabia and move their regional headquarters to Riyadh in order to benefit from government contracts.
But the kingdom has struggled to attract foreign direct investment (FDI), one of the pillars of Vision 2030, which reached just under $4.1 billion in the first half of 2022, a fraction of the $100 billion target for the end of the decade. – Agencies.
