This article was published by Cartea.
Saudi Arabia, recognized as one of the largest car markets in the Middle East, is currently experiencing a significant transformation in its automotive sector. The February 2025 Saudi Automotive Market Report released by Cartea—a specialized platform that offers comprehensive car news, accurate buying advice, and complete vehicle services tailored for Arabic-speaking consumers—shows that manufacturers from Japan and South Korea together hold more than half of the overall market share. Notably, Toyota and Hyundai continue to lead the sales charts, while new competitors are gradually reshaping the competitive landscape. By comparison, the top five Chinese automakers combined only control about 5.3% of the market, which highlights the considerable challenges they face in expanding their presence within Saudi Arabia.
Despite the ongoing dominance of fuel-powered vehicles, which make up 93.3% of sales, the market is witnessing an increased demand for family-friendly cars and a growing interest in smart vehicle features. This evolving consumer behavior raises two critical questions: How can Chinese car manufacturers disrupt the established dominance of Japanese and Korean companies? Additionally, how can these brands cater effectively to the Saudi market’s core requirements for affordable sedans, seven-seat SUVs, and services that are adapted to local preferences?
This article explores the current market situation by examining three key aspects—brand positioning, vehicle segment distribution, and online consumer search patterns—with the goal of providing Chinese manufacturers valuable strategic guidance to gain a stronger foothold in this competitive arena.
1. Brand Positioning
The Saudi car market presently demonstrates a “three-pronged” structure in brand competition:
- Established Leaders: Japanese and Korean automakers retain their leadership position due to their extensive dealership networks, strong reputations for reliability, and comprehensive after-sales support. These elements collectively build lasting consumer confidence.
- Emerging Challengers: Both international and regional newcomers are rapidly increasing their market shares. Their progress is fueled by aggressive localized marketing efforts and the launch of new models specifically designed to appeal to Saudi buyers.
- Chinese Entrants: Chinese brands have begun penetrating the mid-tier price segments—mainly within the SAR 50,000 to 120,000 range. However, they have yet to make a significant impact in the premium market segments above SAR 120,000, underscoring the tough road ahead.
2. Distribution of Vehicle Types
- In February 2025, more than half of the new vehicle registrations were for sedans, predominantly priced within the SAR 50,000 to 120,000 bracket, illustrating the market’s preference for affordable, fuel-efficient cars. Meanwhile, SUVs accounted for over 30% of the sales, with the highest demand seen in the SAR 120,000+ price category. The popularity of SUVs is driven primarily by families seeking seven-seat vehicles that offer dependable off-road capabilities.
- Despite the increasing appeal of these segments, Chinese car models have yet to attract significant interest either in the sedan or SUV categories. This suggests a gap between their current product offerings and the specific preferences of Saudi consumers.
3. Preferences for Powertrains
- Vehicles powered by traditional internal combustion engines (ICE) still dominate the Saudi market, making up 93.3% of all sales. Hybrid electric vehicles (HEVs) occupy only a small niche, and new-energy vehicles (NEVs)—including both battery-electric and plug-in hybrids—have only recently started to gain entry.
- Several factors have contributed to the slow adoption of NEVs, such as limited availability of charging stations, lack of consumer familiarity with the technology, and the low cost of conventional fuel, which diminishes the economic incentive to switch to electric vehicles.
4. Market Penetration by Price Segment
- Chinese carmakers have seen early success in the mid-priced segment ranging from SAR 50,000 to 120,000, particularly by promoting compact sedans that offer a “high specification at a low cost.” However, their presence remains minimal in premium price categories above SAR 120,000, where luxury sedans and upscale SUVs continue to be dominated by well-established Japanese and Korean brands.
- To expand their reach into these higher-end market tiers, Chinese manufacturers need to focus on improving product quality, growing their service infrastructure, and enhancing brand prestige.
5. Consumer Search Trends Online
Analysis of digital search data from Saudi Arabia reveals:
- Jetour leads among Chinese brands with 15,959 search queries, largely driven by the launch of a new model and intensified localized marketing efforts.
- Changan ranks highest in potential website traffic, receiving close to 86,000 visits, indicating the strong appeal of its Saudi-focused product range and marketing approach.
These online metrics highlight the critical role of targeted digital engagement and customized advertising in boosting brand visibility and consumer consideration.
Strategic Recommendations
Integrating the market sales data with consumer online behavior, the Cartea Research Institute outlines three vital strategies for automakers—especially those from China—seeking to grow their market share in Saudi Arabia:
- Master the Tripolar Brand Framework
Use flexibility and regionally customized product offerings to contend with rapidly growing challengers. Improve perceived quality and after-sales service to penetrate premium market segments currently held by dominant leaders. - Adapt to Powertrain Market Realities
Recognize that ICE vehicles will continue to prevail in the near future, with hybrids serving as an intermediate solution. Facilitate broader NEV adoption through investments in charging infrastructure and consumer education programs. - Focus on Core Consumer Demands
Address the needs of cost-conscious sedan buyers in the SAR 50,000 to 120,000 price bracket. Increase the availability of sturdy, seven-seat SUVs priced above SAR 120,000 to meet family and off-road preferences.
This comprehensive insight into the Saudi automotive market provides a roadmap for Chinese carmakers and other newcomers aiming to challenge entrenched competitors and cater effectively to evolving consumer demands.
