Market Size and Overview:

The Saudi Arabia Transportation as a Services Market is valued at USD 341 million and is projected to reach a market size of USD 85.66 million by the end of 2030. Over the forecast period of 2024-2030, the market is projected to grow at a CAGR of 11.1%. 

In the vast landscape of Saudi Arabia's transportation sector, the emergence of Transportation as a Services (TaaS) has been a significant long-term driver reshaping the market dynamics. The Kingdom's ambitious Vision 2030 initiative aimed at diversifying the economy and reducing dependence on oil, has catalyzed investments and innovations in the transportation sector. The integration of technology-driven solutions, such as ride-hailing apps and smart mobility platforms, has revolutionized the way people commute, leading to increased efficiency and convenience. Furthermore, the growing emphasis on sustainability and environmental conservation presents a significant opportunity for the TaaS market in Saudi Arabia. With the government's commitment to reducing carbon emissions and promoting eco-friendly transportation alternatives, there is a burgeoning demand for electric vehicles (EVs) and other clean energy solutions. Companies offering electric scooter rentals, bike-sharing programs, and EV charging infrastructure stand to benefit from this shift towards greener mobility options.

A notable trend observed in the Saudi Arabia TaaS market is the convergence of traditional transportation services with emerging technologies. This fusion has given rise to innovative business models such as Mobility-as-a-Service (MaaS), which aim to provide seamless, multi-modal transportation experiences to consumers.

Key Market Insights:

The Saudi Arabia Transportation as a Services Market is projected to expand at a compound annual growth rate of over 2.9% in the coming seven years, propelled by Government Initiatives and Policies Promoting Sustainable Mobility.

Transportation as a service is the integration of digital channels through transport methods such as car and bike sharing, taxis and car rentals/leases which enables consumers to plan, book, and pay for multiple types of transportation services.

Apps like Ola, Uber, Lyft and others are some example of Transportation as a service.

Uber (United States), Careem (United Arab Emirates), Grab (Singapore) are 3 major players of example of Saudi Arabia transportation as a service

Saudi Arabia Transportation as a Services Market Driver:

Urbanization and Population Growth drives the market demand for Saudi Arabia Transportation as a Services Market.

As Saudi Arabia undergoes rapid urbanization, with a significant portion of the population migrating to major cities like Riyadh, Jeddah, and Dammam, the demand for efficient transportation solutions escalates. Urban centers are becoming increasingly congested, necessitating innovative mobility options to address commuting challenges. The influx of residents into cities fuels the adoption of Transportation as a Services (TaaS), driving the growth of ride-hailing services, micro-mobility solutions, and integrated mobility platforms. Urbanization serves as a key driver in shaping the TaaS market landscape, as companies strive to meet the evolving mobility needs of urban dwellers.

Saudi Arabia Transportation as a Services Market Restraints and Challenges:

The Saudi Arabia Transportation as a Services (TaaS) market faces regulatory challenges stemming from evolving policies and licensing requirements. The regulatory landscape for ride-hailing services, in particular, is subject to change, impacting the operations and expansion plans of TaaS providers. Uncertainty surrounding licensing procedures, vehicle standards, and fare regulations creates barriers to entry and complicates business strategies for market players.

Despite on-going investments in infrastructure development, Saudi Arabia grapples with limitations in transportation infrastructure, especially in secondary cities and rural areas. Inadequate road networks, insufficient public transit options, and a lack of designated pick-up/drop-off points pose logistical challenges for TaaS providers. Improving infrastructure connectivity and enhancing last-mile access are critical to expanding the reach and accessibility of TaaS services across the Kingdom.

Saudi Arabia Transportation as a Services Market Opportunities:

The integration of Mobility-as-a-Service (MaaS) platforms presents a significant opportunity for the Saudi Arabia TaaS market. MaaS offers a unified digital platform for planning, booking, and paying for multi-modal transportation services, including public transit, ride-hailing, and bike-sharing. By integrating various transportation modes into seamless, user-centric experiences, MaaS enhances convenience, accessibility, and sustainability, driving market growth.

Electric and Autonomous Vehicles Adoption: The adoption of electric vehicles (EVs) and autonomous vehicles (AVs) presents opportunities for innovation and differentiation in the Saudi Arabia TaaS market. With increasing environmental concerns and technological advancements, there is growing interest in electric and autonomous mobility solutions. EV fleets offer environmental benefits and cost savings, while AVs promise enhanced safety, efficiency, and convenience. Market players can capitalize on these trends by investing in EV charging infrastructure, AV technology development, and fleet management solutions.

Saudi Arabia Transportation as a Services Market Segmentation

Saudi Arabia Transportation as a Services Market: By Mode of Transport:

• Ride-Hailing Services
• Micro-Mobility Services
• Public Transit Integration

 Ride-hailing services, such as Uber and Lyft, dominate the Saudi Arabia transportation market due to their convenience and accessibility. With the widespread adoption of smartphones and the increasing preference for on-demand transportation, ride-hailing services have become the preferred choice for many individuals.

Micro-mobility services, including electric scooters and bikes, are experiencing rapid growth in Saudi Arabia. These services offer an environmentally friendly and cost-effective alternative for short-distance travel in urban areas. With increasing concerns about traffic congestion and environmental sustainability, micro-mobility solutions are gaining popularity among commuters.

Saudi Arabia Transportation as a Services Market Segmentation:  By Service Type:

• Individual Transportation
• Corporate Transportation
• Freight and Logistics

The Individual transportation services, such as ride-hailing and micro-mobility, cater to the needs of individual consumers. These services provide convenient and flexible options for personal travel, allowing users to access transportation on-demand without the need for ownership or maintenance of vehicles.

Freight and logistics services are witnessing significant growth in Saudi Arabia, driven by the expansion of e-commerce and the need for efficient delivery solutions. With the rise of online shopping and same-day delivery expectations, there is a growing demand for reliable and timely freight services to transport goods across the region.

Saudi Arabia Transportation as a Services Market Segmentation: By End-User:

• Consumer
• Businesses
• Government and Public Agencies

The consumer segment represents the largest user base for transportation services in Saudi Arabia. Individual consumers rely on various transportation options, including ride-hailing, micro-mobility, and public transit, to meet their personal travel needs and commute to work or leisure activities.

Businesses are increasingly adopting transportation services to optimize their operations and meet the evolving needs of their employees and customers. Corporate transportation solutions, such as shuttle services and corporate ride-hailing accounts, are becoming popular among businesses looking to streamline employee commutes and provide convenient transportation options.

Saudi Arabia Transportation as a Services Market Segmentation: Regional Analysis:

Regional analysis reveals that certain metropolitan areas serve as focal points for TaaS adoption and usage, making them the largest segments of the market. Cities such as Riyadh, Jeddah, and Dammam exhibit high population densities, rapid urbanization, and strong economic activities, driving significant demand for transportation services. These urban centers boast extensive networks of ride-hailing services, public transit systems, and emerging mobility solutions, catering to the diverse needs of residents and commuters. Riyadh, the capital city and economic hub of Saudi Arabia, stands out as one of the largest segments in the TaaS market. Its sprawling urban landscape, burgeoning population, and robust business ecosystem fuel demand for transportation options ranging from ride-hailing to micro-mobility services. Jeddah, a major commercial and cultural center on the Red Sea coast, is another significant segment characterized by its cosmopolitan population, tourism influx, and vibrant transportation scene. Dammam, situated in the Eastern Province and a key industrial hub, represents a sizable segment with a focus on logistics, freight transportation, and workforce mobility.

While established metropolitan areas dominate the TaaS landscape, emerging regions and secondary cities are witnessing rapid growth, emerging as the fastest-growing segments of the market. These areas, driven by factors such as infrastructure development, urban expansion, and changing consumer preferences, present lucrative opportunities for TaaS providers to expand their footprint and capture new market share. Secondary cities like Jazan, Tabuk, and Hail are experiencing accelerated urbanization and economic development, driving demand for transportation services and infrastructure investment. The government's focus on decentralization and regional development initiatives further catalyzes growth in these areas. Additionally, tourist destinations such as Makkah and Madinah witness seasonal spikes in transportation demand due to religious pilgrimages and tourism activities, making them dynamic segments for TaaS providers.

COVID-19 Impact Analysis on Saudi Arabia Transportation as a Services Market:

The imposition of lockdowns, travel restrictions, and social distancing measures led to a significant decline in passenger demand for transportation services. Ride-hailing services, public transit, and shared mobility platforms experienced a sharp downturn in ridership, resulting in revenue losses for TaaS providers. COVID-19 prompted a shift in travel patterns as commuters transitioned to remote work arrangements, reducing the need for daily commuting and business travel. This shift resulted in decreased demand for traditional transportation services during peak hours, impacting the overall utilization of TaaS solutions.

In response to health and safety concerns, there was a rapid adoption of contactless services and digital payment solutions in the Saudi Arabia TaaS market. TaaS providers implemented stringent hygiene protocols, introduced contactless payment options, and enhanced cleaning procedures to reassure passengers and mitigate the risk of virus transmission.

Latest Trends/ Developments:

Ride-hailing services like Uber and Careem (acquired by Uber) have gained significant traction in Saudi Arabia. They offer convenient transportation options, especially in urban areas like Riyadh, Jeddah, and Dammam.

Government Initiatives: The Saudi government has been investing in transportation infrastructure and supporting initiatives to modernize the sector. This includes projects like Riyadh Metro, Jeddah Metro, and the expansion of public transportation networks.

Emergence of Electric Vehicles: There has been a growing interest in electric vehicles (EVs) globally, and Saudi Arabia is no exception. The government has announced plans to promote the adoption of EVs, which could impact the transportation sector, including TaaS.

Integration of Mobility Solutions: Companies are exploring ways to integrate various mobility solutions, including ride-hailing, car-sharing, and public transit, to provide seamless transportation experiences for users.

Technology Adoption: Advancements in technology, including GPS tracking, mobile payments, and artificial intelligence, are enhancing the efficiency and user experience of TaaS offerings in Saudi Arabia.

Key Players:

1. Uber (United States)

2. Careem (United Arab Emirates)

3. Grab (Singapore)

4. Bolt (Estonia)

5. Didi Chuxing (China)

6. Lyft (United States)

7. Ola (India)

8. Yandex.Taxi (Russia)

9. BlaBlaCar (France)

10. Via (United States)

11. Gojek (Indonesia)

12. Curb (United States)

13. Karwa (Qatar)

14. Swvl (Egypt)

15. Halan (Egypt)

16. Jeeny (France)

17. RTA Dubai (United Arab Emirates)

18. Airlift (Pakistan)

19. Pathao (Bangladesh)

20. Gett (Israel)