Saudi chemical company Sadara and Saudi National Automobiles Manufacturing Co. (SNAM) have signed a cooperation agreement for the supply of speciality chemicals and plastics for SNAM’s planned automotive manufacturing cluster in Al-Jubail, Saudi Arabia.
Under the agreement, Sadara will work with SNAM’s Auto Cluster “tenants” who will include car parts manufacturing companies — primarily OEMs and automotive Tier-1 and Tier-2 manufacturers.
The chemicals company will identify potential third-party investors who will use its specialist chemicals and plastics products to manufacture automotive parts locally.
Spread over an area of 1 million square meters, the auto cluster is expected to be the largest manufacturing cluster to be located in PlasChem Park, an industrial zone located adjacent to the Sadara site in Jubail Industrial City II.
The park is being developed in collaboration with the Royal Commission for Jubail and Yanbu and will consist of downstream chemical and conversion industries supplied with products from Sadara and others in Jubail.
“Our specialty chemical products can be utilized by third-party investors to make components used in automobile manufacturing,” said Ziad Al-Labban, CEO of Sadara.
The project will include basic facilities such as a press shop, welding (body) shop, paint shop, and general assembly shop, in addition to support facilities such as a logistics warehouse, test track, and admin building.
Another one million square meters next to SNAM’s factory has been allocated for automotive Tier-1 suppliers.