Saudi Arabia launches BAE Systems Arabian Industries to localize defense manufacturing

22/05/2025 05:38 AST

Defense manufacturing is set to advance in Saudi Arabia with the launch of BAE Systems Arabian Industries, a new entity aimed at accelerating localization and strengthening the Kingdom's military industrial base.

The company results from the merger of two major players in the defense ecosystem - BAE Systems Saudi Development and Training, which focuses on capability building, and the Saudi Maintenance and Supply Chain Management Co., a provider of supply chain and technical services, the Saudi Press Agency reported.

The move marks further progress in the Kingdom's push to expand its defense capabilities, with localization of military spending rising to 19.35 percent in 2024, up from just 4 percent in 2018. The Kingdom aims to surpass 50 percent by 2030, in line with Vision 2030's goal of a self-sufficient defense sector.

Ahmad Abdulaziz Al-Ohali, governor of the General Authority for Military Industries, inaugurated BAE Systems Arabian Industries at an official ceremony held at the company's new headquarters in Riyadh, attended by several officials and defense industry leaders.

In a post on his X handle, the governor said: "This will enhance local content and open up broad horizons for national and international companies to contribute to building a solid and sustainable military-industrial system, to enhance local content in terms of human and technical cadres."

The merger was finalized nearly four months ago to consolidate operational strengths and leverage over three decades of experience in defense training, capability development, and logistics.

"He pointed out that the integration of national and global expertise within this unified entity reflects the confidence of major companies in the attractive investment environment provided by the authority in cooperation with its partners in both the public and private sectors," the SPA report stated.

Al-Ohali noted that the initiative would play a key role in transferring knowledge and building national expertise, supporting the Kingdom's goal of localizing over 50 percent of military spending by 2030.

He reaffirmed the authority's support for initiatives that boost local content and create opportunities for both national and international companies to help build a strong and sustainable military-industrial sector.

In a LinkedIn post, Abdulatif Al-Shaikh, the new company's CEO, said: "We are guided by a clear vision to be the leading Saudi company in the defense sector by supporting and developing capabilities within the Kingdom and across the region, in alignment with Vision 2030."

In another development, Saudi Arabia recently completed production of its first locally manufactured components for the Terminal High Altitude Area Defense, or THAAD system launcher, in Jeddah.

This follows localization agreements signed during the 2024 World Defense Show and reflects increasing technical collaboration with global defense firms such as Lockheed Martin.

Arab News