SAR plans transformation into holding entity: CEO

Bashar Al-Malik CEO at Saudi Arabia Railways (SAR), revealed a plan to transform SAR into a holding company, privatize economically viable activities, and ultimately list its subsidiaries on the stock market.

Speaking in a TV show, Al-Malik explained that the transformation aims to separate passenger, freight, and mining operations. He noted that intercity passenger rail services are generally unprofitable worldwide and require government support to operate, while freight activities are profitable and help finance the company’s expansion.

As for the mining segment, he explained that the railway network was primarily developed to serve and support this sector.

The top executive noted that the company has achieved its return targets in 2025; however, this was not reflected in profitability due to the continued subsidization of certain sectors and the lack of full compensation so far, as an appropriate tariff has yet to be agreed upon. He stressed that railway performance should not be measured solely by direct profitability, as railways can be economically viable while supporting other sectors.

Railways are a key driver of the mining industry, as they are used to transport phosphate, bauxite, and sulfur over distances of up to 1,500 kilometers, according to Al-Malik.

Regarding future projects, the CEO expected the launch of the first Riyadh–Doha train services in 2031, noting that the cost will be jointly borne by both countries. He also indicated that the primary objective of the project is aligned with the Kingdom’s ambition to become a logistics hub, alongside plans to link the GCC countries.

He pointed out that the land bridge is the most important and largest project, with a cost of around SAR 100 billion, aimed at connecting Jeddah Port with Riyadh and the Eastern Province, expecting it to be fully completed before 2034, with a target completion date of 2032 or 2033.

As for the GCC Railway, Al-Malik explained that progress varies from one country to another, with some having started, others having completed their sections, and some yet to begin. In Saudi Arabia’s case, significant progress has been made, with around 200 kilometers completed out of a total of 600 kilometers. He confirmed that all countries remain committed to implementation, and the project is expected to be completed according to the targeted plan in 2030, which provides sufficient time for all parties.

The CEO also confirmed that studies are underway to establish a parallel route to the Mashaaer Train to boost the operational capacity and connect it to the Haramain High-Speed Train. In addition, the company plans to launch a new, fully unified application for all train services before the end of this year to improve booking and payment experiences. He revealed that Saudi Arabia is testing new technologies such as hydrogen-powered trains and monitoring the maturity of hyperloop and magnetic levitation technologies, with a view to adopting them once they prove their commercial viability, in order to ensure technological leadership.

Additionally, the Kingdom aims to expand the railway network to at least 8,000 kilometers by 2030, an increase of 2,000 kilometers from the current 6,000-kilometer network. The goal is to transport 30% of containers and goods by rail instead of trucks, in order to reduce hidden costs such as road congestion, accidents, and asphalt consumption. Strategic plans are also in place to extend rail connections to Jeddah Port and King Abdullah Economic City Port, according to the top executive.

Al-Malik also emphasized that SAR will not proceed with any major projects unless international partners commit to a minimum level of local content, to ensure localization of the industry and job creation.