Saudi Arabia Automotive Lubricants Market

Saudi Arabia Automotive Lubricants Market Size:

Saudi Arabia automotive lubricants market size reached US$ 729 Million in 2023. Looking forward, IMARC Group expects the market to reach US$ 905 Million by 2032, exhibiting a growth rate (CAGR) of 2.40% during 2024-2032. The expanding automotive sector, rising vehicle ownership, the increasing demand for high-performance lubricants, the climatic conditions of the country, economic growth, rising infrastructure development, and the increasing focus on vehicle maintenance are some major factors propelling the market growth across the Kingdom of Saudi Arabia (KSA).

Saudi Arabia Automotive Lubricants Market Analysis:

• Major Market Drivers: The rising vehicle ownership due to economic growth and increasing urbanization represents the major driver of the market, which is boosting the demand for lubricants. Government investment in infrastructure and transportation also promotes the market growth. The hot climate necessitates frequent oil changes, thereby further increasing lubricant consumption.
• Key Market Trends: The growing shift toward synthetic and semi-synthetic oils, driven by the rising demand for higher engine efficiency represents the key trend of the market. Another trend is the increasing focus on environmentally friendly lubricants, which is aligning with sustainability goals of the country.
• Competitive Landscape: The report has also provided a comprehensive analysis of the competitive landscape in the market. Competitive analysis such as market structure, key player positioning, top winning strategies, competitive dashboard, and company evaluation quadrant has been covered in the report. Also, detailed profiles of all major companies have been provided.
• Challenges and Opportunities: The market faces several challenges including fluctuating crude oil prices, which affect lubricant production costs and increasing environmental regulations on emissions and waste management. However, the market also faces various opportunities, such as the growing preference for high-performance synthetic lubricants due to extreme climate conditions.

Saudi Arabia Automotive Lubricants Market Trends:

Growing Vehicle Ownership

Economic growth and rising urbanization have led to increased vehicle ownership, boosting the demand for automotive lubricants. As disposable incomes rise and more people purchase vehicles, the demand for automotive lubricants naturally grows. For instance, in July 2024, Saudi Arabia imported over 1 million vehicles in the 15 months to March, valued at over SR83 billion ($22 billion), making it one of the top 20 global markets. Data from the General Authority for Statistics reveals that these imports of new and used vehicles from 51 countries covered 2023 and the first quarter of 2024. The Kingdom imported 568,500 cars from the US, China, Germany, Japan, and South Korea in 2022, as per the data from Zakat, Tax and Customs Authority of the country. This comes as improvements in procedures and regulations by relevant government entities have organized the industry, increased the market for both new and used cars, and led to annual vehicle sales exceeding 700,000, the report added.

Harsh Climate Conditions

Saudi Arabia’s extreme climate, characterized by high temperatures and dusty environments, puts added stress on vehicle engines. This increases the frequency of oil changes and the need for high-performance lubricants that can protect engines under harsh conditions. The demand for synthetic and semi-synthetic lubricants, known for better engine protection and durability in high temperatures, is steadily growing as a result. For instance, in June 2024, from June 16th to June 18th, during the Hajj pilgrimage, Saudi Arabia witnessed temperatures reach 47°C with temperatures at least 1.5 to 2°C higher in Mecca and Medina, the two cities at the heart of Hajj pilgrimage. This year, more than 1.8 million Muslim pilgrims were expected to arrive, according to the Saudi General Authority for Statistics. Extreme heat claimed the lives of at least 550 pilgrims, with temperatures at Mecca's Grand Mosque reaching a scorching 51.8 degrees Celsius. According to the industry reports, Saudi Arabia had a CSI of 5, meaning that human-caused climate change made a given daily average temperature five times more likely. These statistics are reflective of the imminent need for automotive lubricants that can sustain in the extreme climatic conditions of the country, which, in turn, is contributing to the market growth.

Expansion of Infrastructure and Transportation

Government investments in infrastructure, roads, and transportation systems fuel the demand for vehicles and automotive maintenance, subsequently increasing the need for lubricants in the market. For instance, in August 2024, the first phase of plans to upgrade Riyadh’s road infrastructure began. The Royal Commission for Riyadh City (RCRC) awarded four contracts worth SAR13 billion ($3.5 billion) to develop the road network in the Saudi capital. The projects are a part of the plan announced in 2020 by Crown Prince, who is also the chairman of RCRC, to upgrade the transportation network and transform Riyadh into one of the world’s major cities in line with Vision 2030 objectives.

Saudi Arabia Automotive Lubricants Market Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the market, along with forecasts at the country and regional levels for 2024-2032. Our report has categorized the market based on vehicle type and product type.

Breakup by Vehicle Type:

• Commercial Vehicles 
• Motorcycles 
• Passenger Vehicles
   

The Saudi Arabia automotive lubricants industry report has provided a detailed breakup and analysis of the market based on the vehicle type. This includes commercial vehicles, motorcycles, and passenger vehicles.

The growth of commercial vehicles in Saudi Arabia is driven by large-scale infrastructure projects, government investments in logistics, and the expansion of the construction industry. The country's Vision 2030 initiative, aimed at economic diversification, has fueled demand for heavy trucks and other commercial vehicles. These vehicles require frequent maintenance and lubrication due to heavy usage, long-haul operations, and harsh climatic conditions, leading to increased consumption of high-performance lubricants.

The increasing popularity of motorcycles for personal mobility and leisure in Saudi Arabia is driving growth in the motorcycle lubricants segment. Rising traffic congestion in urban areas, coupled with the affordability and convenience of motorcycles, has spurred demand. Additionally, the growth of delivery services and food delivery apps, which rely heavily on motorcycles, boosts lubricant consumption. Motorcycles, operating under high temperatures, require frequent lubricant changes for optimal engine performance and longevity.

The growth in passenger vehicles is fueled by rising urbanization, increased purchasing power, and growing car ownership among Saudi households. The government’s push for economic diversification and a more inclusive workforce has also expanded the need for personal vehicles. Additionally, the harsh climate and long driving distances require frequent maintenance, including regular oil changes, increasing the demand for automotive lubricants in this segment.

Breakup by Product Type:

• Engine Oils
• Greases
• Hydraulic Fluids
• Transmission and Gear Oils
   

A detailed breakup and analysis of the market based on the product type have also been provided in the report. This includes engine oils, greases, hydraulic fluids, and transmission and gear oils.

The harsh climatic conditions in Saudi Arabia, characterized by extreme heat and dust, necessitate frequent engine oil changes for optimal vehicle performance and protection. Growing vehicle ownership, both in passenger and commercial segments, is another key driver. The increasing preference for high-performance synthetic and semi-synthetic oils, due to their superior heat resistance and engine protection, further boosts the demand for engine oils in the market, particularly in the automotive maintenance sector.

Greases are essential for lubricating various mechanical components in vehicles, especially under harsh environmental conditions. The growth in the construction, logistics, and industrial sectors, which rely on heavy machinery and commercial vehicles, increases the need for greases. In Saudi Arabia's hot and dusty environment, frequent maintenance of vehicle joints, bearings, and other moving parts is required, making greases a crucial lubricant. Expanding automotive sales also contributes to the steady demand for grease products.

Hydraulic fluids are in high demand due to the growing use of heavy-duty vehicles and construction machinery in Saudi Arabia’s infrastructure projects. The development of transportation and industrial sectors, driven by initiatives such as Vision 2030, requires efficient hydraulic systems. Frequent maintenance of hydraulic systems, such as brakes and steering, in both commercial and passenger vehicles is essential due to high operational stress. The hot climate increases the need for high-quality hydraulic fluids to ensure optimal system performance.

Transmission and gear oils are crucial for maintaining the smooth operation of vehicle gearboxes and transmissions, especially under the strain of heavy use. Saudi Arabia's expanding transportation and logistics sectors, along with rising vehicle ownership, increase demand for these oils. The country's harsh climate and long driving distances necessitate high-performance lubricants for better gear protection and efficiency. Additionally, the growing adoption of automatic transmissions in vehicles boosts demand for advanced transmission fluids which are further fueling the Saudi Arabia automotive lubricants market share.

Breakup by Region:

• Northern and Central Region
• Western Region
• Eastern Region
• Southern Region
   

The report has also provided a comprehensive analysis of all the major markets in the region, which include the Northern and Central Region, Western Region, Eastern Region, and Southern Region.

The Northern and Central regions, including Riyadh, benefit from being the political and economic hubs of Saudi Arabia. Rapid urbanization, population growth, and increased vehicle ownership drive lubricant demand. Government investment in infrastructure, construction, and transportation as part of Vision 2030 further boosts demand for commercial vehicles, which require regular maintenance. Additionally, the region's harsh desert climate increases the need for high-performance lubricants to ensure engine efficiency and longevity under extreme conditions.

The Western region, which includes Jeddah and Makkah, sees significant growth in automotive lubricants due to religious tourism and port activities. The influx of pilgrims during Hajj and Umrah increases the use of passenger and commercial vehicles, creating high demand for lubricants. Additionally, the region’s position as a key trade and logistics hub drives the commercial vehicle segment, requiring frequent lubricant changes for long-haul transport. Economic diversification initiatives are also fueling industrial and automotive growth.

The Eastern region, home to Saudi Arabia’s oil and gas industry, experiences strong demand for lubricants driven by industrial activity, particularly in petrochemicals and energy. The presence of refineries and heavy industrial machinery necessitates the use of high-quality lubricants. Additionally, the region’s wealth and economic stability contribute to rising vehicle ownership and maintenance needs. Infrastructure projects and transportation networks in this oil-rich region also boost the demand for commercial vehicle lubricants.

The Southern region, known for its agricultural and mining activities, contributes to the demand for automotive lubricants, especially for commercial vehicles used in these industries. The region’s growing logistics and transportation network, supporting trade and agricultural exports, also drive lubricant consumption. In addition, the challenging terrain and weather conditions in the Southern areas require more frequent vehicle maintenance and the use of high-performance lubricants for both passenger and commercial vehicles.

Competitive Landscape:

• The report has also provided a comprehensive analysis of the competitive landscape in the market. Competitive analysis such as market structure, key player positioning, top winning strategies, competitive dashboard, and company evaluation quadrant has been covered in the report. Also, detailed profiles of all major companies have been provided.
• The automotive lubricants market in Saudi Arabia is highly competitive, dominated by both international and domestic players. Key companies include Saudi Aramco (Petromin), Shell, TotalEnergies, ExxonMobil, and Castrol. Local brands like Alhamrani Fuchs and Aljomaih Lubricants also hold significant market share. These companies compete based on product quality, brand reputation, distribution networks, and partnerships with automotive manufacturers and service centers. For instance, in June 2024, Al Jomiah and Shell Lubricating Company signed a strategic partnership with Autolead to open and operate Shell service centers across the Kingdom of Saudi Arabia. The signing ceremony was attended by the heads of both companies, highlighting the importance of this collaboration in delivering an exceptional customer experience.

Saudi Arabia Automotive Lubricants Market News:

• In February 2024, SERVO, a world-Class Lubricant, was launched in the Kingdom of Saudi Arabia by IOC Middle East FZE, a wholly owned subsidiary of IndianOil, a Fortune ‘Global 500 company and India’s flagship petroleum major. In the Kingdom of Saudi Arabia, SERVO partnered with the Mohammed Yousuf Naghi group, one of the foremost and dynamic conglomerates of the country with business interests ranging from logistics to luxury cars and consumer products to catering.
• In December 2023, Motul, one of the world’s leading companies specializing in the formulation, production, and distribution of high-tech engine oils, announced the launch of 8100 Power, a fully synthetic ESTER lubricant, across the Middle East. The product is designed for daily use performance on the road and focuses on delivering enhanced power and protection for everyday drivers.

Saudi Arabia Automotive Lubricants Market Report Scope:

Key Questions Answered in This Report:

• How has the Saudi Arabia automotive lubricants market performed so far, and how will it perform in the coming years?
• What has been the impact of COVID-19 on the Saudi Arabia automotive lubricants market?
• What is the breakup of the Saudi Arabia automotive lubricants market on the basis of vehicle type?
• What is the breakup of the Saudi Arabia automotive lubricants market on the basis of product type?
• What are the various stages in the value chain of the Saudi Arabia automotive lubricants market?
• What are the key driving factors and challenges in the Saudi Arabia automotive lubricants market?
• What is the structure of the Saudi Arabia automotive lubricants market, and who are the key players?
• What is the degree of competition in the Saudi Arabia automotive lubricants market?

Key Benefits for Stakeholders:

• IMARC’s industry report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the Saudi Arabia automotive lubricants market from 2018-2032.
• The research report provides the latest information on the market drivers, challenges, and opportunities in the Saudi Arabia automotive lubricants market.
• Porter's five forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the Saudi Arabia automotive lubricants industry and its attractiveness.
• The competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.