(MENAFN- GlobeNewsWire - Nasdaq) Saudi Arabia's electric bus market is expanding due to sustainability efforts and Vision 2030, boosting demand through mega projects like NEOM. Opportunities include adopting smart technologies and forming public-private partnerships, despite high initial costs. Key players are SAPTCO, Tata Motors, and Mercedes-Benz.Dublin, Oct. 02, 2025 (GLOBE NEWSWIRE) -- The "Saudi Arabia Electric Bus Market by Region, Competition, Forecast & Opportunities, 2020-2030F" report has been added to ResearchAndMarkets's offering.
The Saudi Arabia Electric Bus Market was valued at USD 85.25 Million in 2024, and is projected to reach USD 130.43 Million by 2030, rising at a CAGR of 7.39%.
Saudi Arabia's electric bus market is witnessing steady growth, driven by the government's Vision 2030 initiatives focused on sustainability and reduced dependence on fossil fuels. Efforts to modernize public transport systems and reduce carbon emissions are encouraging the adoption of electric buses across major cities like Riyadh, Jeddah, and Dammam.
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Mega projects such as NEOM and the Red Sea Project are integrating electric mobility solutions, further boosting demand. Additionally, According to the General Authority for Statistics, Saudi Arabia registered approximately 625,000 new vehicles in 2023, up from 540,000 in 2022 highlighting economic recovery and Vision 2030-driven government spending. This surge supports rising demand and infrastructure development, propelling electric bus market growth across the Kingdom.
Key Market Drivers
Vision 2030 and Government Initiatives
Saudi Arabia's electric bus market is significantly influenced by its national development plan, Vision 2030, which aims to diversify the Kingdom's economy away from oil dependency and create a more sustainable and environmentally conscious society. Central to this transformation is the emphasis on green transportation and decarbonizing the mobility sector. The government is actively investing in public transportation modernization, including electric buses, to reduce greenhouse gas emissions, improve air quality, and enhance energy efficiency. According to the Saudi Ministry of Industry and Mineral Resources (2024), the Kingdom plans to locally produce over 300,000 vehicles annually by 2030, including electric models driving EV market growth through industrialization, localization, and alignment with Vision 2030 objectives.
Public transport authorities, such as the Royal Commission for Riyadh City (RCRC) and the Saudi Public Transport Company (SAPTCO), have started incorporating electric buses into their fleets. Additionally, the government has launched pilot programs to test electric buses in urban settings, signaling long-term support. These policy-level initiatives are complemented by favorable regulations, subsidies, and incentives that promote investment in electric vehicle (EV) technologies and encourage public-private partnerships to build the required ecosystem.
Key Market Challenges
High Initial Investment and Total Cost of Ownership
The high upfront cost of electric buses compared to their diesel counterparts remains a substantial barrier in Saudi Arabia, particularly for public and private operators seeking cost-effective transport solutions. Although electric buses offer long-term savings through lower fuel and maintenance costs, the initial capital expenditure which includes the cost of the bus, charging infrastructure, depot upgrades, and training is significantly higher.
This cost differential can be especially challenging in markets that are still transitioning and lack established financial support mechanisms. While the government offers some incentives under its sustainability and Vision 2030 plans, subsidies and financing models are not yet widespread or standardized. Many smaller transport companies and municipalities may find the transition financially burdensome without substantial external funding or public-private partnership models.
Key Market Trends
Integration of Smart Technologies and Telematics
A prominent trend in the Saudi electric bus market is the integration of smart technologies and telematics to optimize fleet performance, enhance safety, and reduce operating costs. Electric buses are increasingly being equipped with advanced telematics systems that provide real-time data on vehicle location, battery status, energy consumption, driving patterns, and maintenance needs. These systems enable transport operators and city authorities to monitor bus fleets efficiently, detect issues proactively, and optimize route planning.
Furthermore, as part of Saudi Arabia's broader smart city ambitions, cities such as Riyadh and NEOM are adopting intelligent transportation systems (ITS) that allow electric buses to communicate with traffic signals, control centers, and charging stations. This connectivity ensures smoother traffic flow, minimizes downtime, and improves passenger experience. In the coming years, the adoption of AI-driven route optimization, predictive maintenance, and driver assistance features is expected to become a standard in the country's electric bus landscape.
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