Saudi Arabia electric vehicle battery market Size, Share, Growth Drivers, Trends, Opportunities & Forecast 2025–2030

Saudi Arabia Electric Vehicle Battery Market Overview

• The Saudi Arabia Electric Vehicle Battery Market is valued at USD 2.3 billion, based on a five-year historical analysis. This growth is primarily driven by the increasing adoption of electric vehicles, large-scale public and private investments in charging infrastructure, and advancements in battery technology. The rising demand for energy-efficient solutions, the need to reduce carbon emissions, and the localization of battery assembly under Saudi Vision 2030 have further propelled the market's expansion.
• Key cities such as Riyadh, Jeddah, and Dammam dominate the market due to their significant urban populations and infrastructure development. Riyadh, as the capital, leads in government initiatives and investments in electric vehicle infrastructure, including concentrated investment in charging networks and fleet electrification. Jeddah and Dammam benefit from their strategic locations and growing industrial sectors, making them pivotal in the electric vehicle battery landscape. The Eastern Province, which includes Dammam, is also emerging as a hub for battery and component assembly infrastructure.
• The Public Transport Law, 2023 issued by the Transport General Authority, mandates that all new public transport vehicles procured for urban fleets must be electric by 2030. This regulation requires operators to comply with technical standards for electric vehicles, including battery safety and minimum range thresholds, and supports the national goal of reducing greenhouse gas emissions and fostering a sustainable transportation ecosystem.

Saudi Arabia Electric Vehicle Battery Market Segmentation

By Battery Type:

The battery type segmentation includes Lithium-ion Batteries, Nickel-metal Hydride Batteries, Solid-state Batteries, and Others. Among these, Lithium-ion Batteries dominate the market due to their high energy density, longer lifespan, and decreasing costs, making them the preferred choice for electric vehicles. The growing demand for electric vehicles has led to increased investments in lithium-ion technology, further solidifying its market leadership. Nickel-metal Hydride Batteries are also utilized, particularly in hybrid vehicles, but their market share is declining as lithium-ion technology becomes more prevalent.

By Vehicle Type:

This segmentation includes Passenger Vehicles, Commercial Vehicles, and Two-Wheelers. Passenger Vehicles hold the largest share of the market, driven by consumer preference for electric cars and the increasing availability of models. The commercial vehicle segment is also growing, supported by government initiatives to electrify public transport and logistics. Two-Wheelers, while a smaller segment, are gaining traction due to their affordability and convenience in urban areas, contributing to the overall market growth.

Saudi Arabia Electric Vehicle Battery Market Competitive Landscape

The Saudi Arabia Electric Vehicle Battery Market is characterized by a dynamic mix of regional and international players. Leading participants such as Contemporary Amperex Technology Co., Limited (CATL), LG Energy Solution, Samsung SDI Co., Ltd., BYD Company Limited, Panasonic Corporation, SK On (SK Innovation), Envision AESC Group, Farasis Energy Inc., Northvolt AB, EVE Energy Co., Ltd., Gotion High-Tech Co., Ltd., CALB (China Aviation Lithium Battery), Saft Groupe S.A. (TotalEnergies), Toshiba Corporation, Svolt Energy Technology Co., Ltd. contribute to innovation, geographic expansion, and service delivery in this space.

Saudi Arabia Electric Vehicle Battery Market Industry Analysis

Growth Drivers

• Increasing Government Support for EV Adoption:The Saudi government has committed to investing approximately $8 billion in electric vehicle initiatives in future. This includes subsidies for EV purchases and incentives for manufacturers to establish local production facilities. The Vision 2030 plan aims to have 30% of all vehicles in the Kingdom be electric in future, which translates to around 1.8 million EVs on the road, significantly boosting battery demand.
• Rising Environmental Awareness:With a population of over 36 million, Saudi Arabia is witnessing a growing consciousness regarding environmental issues. In future, the country aims to reduce carbon emissions by 25 million tons annually, promoting electric vehicles as a cleaner alternative. This shift is supported by educational campaigns and partnerships with environmental organizations, leading to increased consumer interest in EVs and their batteries, thus driving market growth.
• Expansion of Charging Infrastructure:In future, Saudi Arabia has installed over 1,200 public charging stations, with plans to increase this number to 6,000. This expansion is crucial for alleviating range anxiety among potential EV buyers. The government is collaborating with private sectors to enhance accessibility, which is expected to facilitate a smoother transition to electric vehicles, thereby increasing the demand for EV batteries significantly.

Market Challenges

• High Initial Costs of Electric Vehicles:The average cost of electric vehicles in Saudi Arabia is approximately $42,000, which is significantly higher than traditional gasoline vehicles priced around $27,000. This price disparity poses a barrier to widespread adoption, particularly among middle-income consumers. Despite government incentives, the high upfront costs remain a significant challenge for the electric vehicle battery market, limiting potential growth.
• Limited Consumer Awareness:Despite the government's push for EV adoption, consumer awareness remains low, with only 35% of the population familiar with electric vehicles and their benefits. This lack of knowledge hampers market growth, as potential buyers are hesitant to invest in EVs and their associated battery technologies. Educational initiatives are essential to bridge this gap and stimulate interest in electric mobility solutions.

Saudi Arabia Electric Vehicle Battery Market Future Outlook

The future of the Saudi Arabia electric vehicle battery market appears promising, driven by increasing government initiatives and a shift towards sustainable energy solutions. In future, the integration of renewable energy sources is expected to power 60% of charging stations, enhancing the appeal of electric vehicles. Additionally, advancements in battery technology, such as solid-state batteries, are anticipated to improve performance and reduce costs, further stimulating market growth and consumer adoption.

Market Opportunities

• Growth in Renewable Energy Integration:The Saudi government aims to generate 60 GW of renewable energy in future, creating a robust ecosystem for electric vehicles. This integration will not only support charging infrastructure but also enhance the sustainability of electric vehicle batteries, making them more attractive to environmentally conscious consumers.
• Development of Local Manufacturing Facilities:In future, Saudi Arabia is positioning itself as a regional hub for EV battery production. This initiative is expected to create thousands of jobs and reduce dependency on imports, ultimately lowering costs and fostering innovation in battery technology.