Saudi starting car company

• Partners with South Korean car manufacturer
• Plans to spend USD500 million
• First prototype expected in two years
• Gazal 1 SUV may go into production

Gazal 1 concept shown at Geneva 2010

Details are yet sketchy in this piece of news, everything we know are listed in the bullet points above and even the name of the Korean car manufacturer remains a mystery.

Could it be Hyundai Kia? Or is it Samsung? Daewoo? or LG? Ssangyong maybe?

What we do know  is that the King Saud University signed the MoU with the Korean firm and students from the university had came up with the Gazal 1 concept based on the Mercedes-Benz G-Wagen.

The only Korean carmaker with German ties, or used to ahve German ties was Ssangyong which built Merc Engiens under licence, and bought the W124 platform for their CHaiman limousine and redesigned the MB100 van as the Ssangyong Istana.

Mercedes-Benz actually bought some of them and sold it with the three-pointed star outside of Korea especially in South East Asia and other parts of the world.

Below the Gallery is the Reuters report of the MoU signing


GALLERY  Gazal 1 concept

Saudi plans $500 million car manufacturing company

(Reuters) - Saudi Arabia plans to start up its first car manufacturing company with a capital of $500 million and expects a prototype within two years, state media reported on Sunday.

Riyadh-based King Saud University's President Abdullah al-Othman signed on Sunday a memorandum of understanding with a South Korean car manufacturing firm to set up the new company.

"(The company) will have a capital of about $500 million," Othman said, quoted by the state news agency SPA.

Up to 15 percent of the financing for the new venture is to be provided by the university's investment arm, Wadi al-Riyadh Technology, while 30 percent will be covered by the Korean firm. The rest will be offered to investors, the agency said.

A prototype of an economic car suitable for local use will be ready within the next two years, Othman said.

Othman said he hoped that Saudi Arabia could export its first car to other Gulf states as well as North African countries.

Saudi Arabia, the largest Arab economy, is heavily dependent on oil and is trying to diversify its revenue to other sources.