Saudi Arabia Transportation Infrastructure Construction Market Size Likely to Reach at a CAGR of 8.5% By 2033

As per the current market research conducted by the CMI Team, the Saudi Arabia Transportation Infrastructure Construction Market size is expected to record a CAGR of 8.5% from 2024 to 2033. In 2024, the market size is projected to reach a valuation of USD 20,160.6 Million. By 2033, the valuation is anticipated to reach USD 42,011.8 Million.

Saudi Arabia Transportation Infrastructure Construction Market: Growth Factors and Dynamics

• Vision 2030 Initiative: Saudi Arabia’s Vision 2030 initiative aims to diversify the economy away from oil dependency. A significant component of this vision involves the development of world-class infrastructure to support various sectors, including transportation. The initiative includes several mega-projects like NEOM, the Red Sea Project, and the Qiddiya entertainment city, all of which require extensive transportation infrastructure, including roads, airports, and ports.

• Government Investment and Policies: The Saudi government has allocated substantial funds towards infrastructure development. The Public Investment Fund (PIF) plays a crucial role in financing major transportation projects. Reforms and policies aimed at encouraging foreign investment and private sector participation in infrastructure projects are also contributing to market growth.

• Urbanization and Population Growth: Rapid urbanization and population growth in cities like Riyadh, Jeddah, and Dammam are driving the demand for improved and expanded transportation networks. There is a significant push towards developing public transportation systems, including metro lines, bus networks, and intercity rail services, to ease urban congestion and improve connectivity.

• Technological Advancements: The adoption of intelligent transportation systems (ITS) and smart city technologies is on the rise, aimed at enhancing the efficiency, safety, and sustainability of transportation networks. Investment in new technologies such as electric vehicles (EVs), autonomous vehicles, and advanced traffic management systems is also influencing the construction market.

• Logistics and Trade Development: Saudi Arabia’s geographical location positions it as a key logistics hub connecting Asia, Africa, and Europe. This has led to substantial investments in upgrading ports and logistics infrastructure. The development of special economic zones (SEZs) and industrial cities, like King Abdullah Economic City (KAEC), is enhancing the demand for robust transportation infrastructure to support industrial and trade activities.

• Private Sector Participation: The government is increasingly encouraging PPPs to leverage private sector expertise and funding in the development of transportation infrastructure. Relaxation of foreign ownership laws and incentives for international investors are attracting global companies to participate in Saudi Arabia’s infrastructure projects.

Saudi Arabia Transportation Infrastructure Construction Market: Partnership and Acquisitions

• In 2023, RATP Dev has inked a deal with the Royal Commission for Al Ula, committing to deliver ‘360 Mobility’ services. This encompasses aiding in the development of comprehensive plans, policies, governance, and infrastructure, as well as transportation assets for AlUla’s innovative mobility network.

• In 2023, Saudi Binladin Group secured contracts valued at SR5bn from Saudi Entertainment Ventures (Seven), a subsidiary of the Public Investment Fund (PIF). The contracts involve constructing two entertainment destinations in the Dammam and Alkhobar regions of Saudi Arabia’s eastern province.

Report Scope

Saudi Arabia Transportation Infrastructure Construction Market: COVID-19 Analysis

The COVID-19 pandemic has significantly impacted the Saudi Arabia Transportation Infrastructure Construction Market, with the industry experiencing both positive and negative effects. Here are some of the key impacts:

• Project Delays and Cancellations: Supply Chain Disruptions: The pandemic caused significant disruptions in global supply chains, leading to shortages of construction materials and equipment. This resulted in delays and, in some cases, cancellations of infrastructure projects. Lockdowns, travel restrictions, and health concerns led to labor shortages. The construction workforce was severely impacted, with many expatriate workers unable to return to the country, delaying project timelines.

• Budget Reallocations and Economic Slowdown: The economic slowdown and drop in oil prices forced the Saudi government to reallocate budgets and cut spending on some infrastructure projects to prioritize healthcare and social support measures. Uncertainty and economic instability caused both domestic and international investors to become more cautious, leading to reduced investment in new and ongoing infrastructure projects.

• Resumption of Projects: As the situation stabilized, the Saudi government resumed suspended projects, prioritizing those aligned with Vision 2030. Increased public spending and incentives helped accelerate the revival of critical infrastructure projects. The launch of new infrastructure projects has picked up the pace, signalling a strong recovery. High-profile projects, such as the Riyadh Metro and the NEOM city, are back on track, attracting renewed interest and investment.

• Economic Diversification Efforts: The commitment to Vision 2030 remains strong, with a focus on diversifying the economy and reducing oil dependency. This long-term strategy ensures sustained investment in infrastructure development as a key enabler of economic diversification. The government has strengthened PPP frameworks to attract private sector participation. By offering incentives and reducing regulatory barriers, Saudi Arabia is encouraging private investment in infrastructure projects, aiding recovery and growth.

• Technological Integration: The integration of smart technologies in infrastructure projects is being accelerated. Intelligent transportation systems (ITS), smart city solutions, and digital construction technologies are being implemented to improve efficiency and resilience. Adoption of remote monitoring, automated construction equipment, and digital project management tools has increased, helping mitigate labor shortages and enhance project delivery timelines.

In conclusion, the COVID-19 pandemic has had a mixed impact on the Saudi Arabia Transportation Infrastructure Construction Market, with some challenges and opportunities arising from the pandemic.

List of the prominent players in the Saudi Arabia Transportation Infrastructure Construction Market:

• Saudi Binladin Group (SBG)
• Saudi Arabian Parsons Limited (SAPL)
• Al Rashid Trading & Contracting Company (RTCC)
• Saudi Oger Ltd.
• Al Mabani General Contractors
• El Seif Engineering Contracting Company
• Al Rajhi Construction LLC
• Nesma & Partners Contracting Co. Ltd.
• Consolidated Contractors Company (CCC)
• China Railway Construction Corporation Limited (CRCC)
• Bechtel Corporation
• Samsung C&T Corporation
• Hyundai Engineering & Construction Co. Ltd.
• China State Construction Engineering Corporation (CSCEC)
• Fluor Arabia Ltd.
• Others

The Saudi Arabia Transportation Infrastructure Construction Market is segmented as follows:

By Mode of Transportation

• Roadways
• Railways
• Airways
• Waterways
• Others

By Type of Construction

• New Construction
• Renovation and Upgrades
• Maintenance

By Project Type

• Urban
• Rural
• Interstate and International
• Others