Saudi Arabia is taking a significant step forward in its ambitious economic transformation with the launch of a tender for the Saudi Landbridge railway network.
Saudi Arabia Railways (SAR) has officially opened bidding for the lead design consultancy services contract for the Saudi Landbridge, a massive railway network spanning over 1,500 kilometers. Interested companies have until May 15, 2025, to submit their proposals, which will cover the concept design, preliminary options, and the Issued for Construction (IFC) stages. With an estimated cost of $7 billion, this Giga project is poised to become one of the largest railway undertakings in the Middle East—and among the most significant globally.
The core of the Saudi Landbridge is a 900-kilometer railway connecting Riyadh, the capital, to Jeddah and King Abdullah Port on the Red Sea coast. Additional components include upgrades to the existing Riyadh-Dammam line, a bypass around Riyadh, and a link between King Abdullah Port and Yanbu. This network promises to streamline freight movement across the kingdom, offering direct access from coastal ports to inland hubs—a critical advantage for businesses reliant on efficient logistics.
The Saudi Landbridge isn’t a new idea—it was first proposed in 2004 but faced delays due to challenges like rights-of-way disputes, route alignment debates, and its hefty price tag. Plans were shelved in 2010, only to be revived a year later. More recently, discussions with China-backed investors hinted at a public-private partnership (PPP) model, but SAR’s decision to launch the design tender directly suggests a shift in approach. This move indicates Saudi Arabia’s determination to explore multiple financing and development options to bring this vision to life.
For executives, this flexibility underscores a key lesson: the kingdom’s business environment is dynamic, and success requires adaptability. At Peninsula, we’ve guided companies like Amazon and Best Western through such shifts, leveraging our deep understanding of local regulations to structure their operations effectively. The Saudi Landbridge’s progress, from concept to tender, mirrors the broader momentum of Saudi construction and infrastructure development under Vision 2030.
The Saudi Landbridge is more than a railway, it’s a cornerstone of Vision 2030, Saudi Arabia’s bold plan to diversify its economy beyond oil. Logistics plays a dual role in this transformation. First, it supports the kingdom’s Giga projects, such as Neom and the Red Sea Project, by ensuring a steady flow of construction materials. Second, it positions Saudi Arabia as a global trade hub, capitalizing on its strategic location along the Asia-Europe shipping corridor.
Vision 2030 aims to make the kingdom a central distribution point for the Gulf Cooperation Council (GCC) region. With twin coastlines on the Red Sea and the Arabian Gulf, Saudi Arabia enjoys a natural edge in maritime logistics. This advantage has proven vital in 2025, as Red Sea tensions disrupt shipping routes, prompting businesses to rethink supply chains. The Saudi Landbridge enhances this flexibility, offering a land-based alternative to move goods efficiently between coasts and into the interior.
For business leaders, this means opportunity. A stronger logistics network reduces costs and delays, making Saudi Arabia an increasingly attractive base for regional operations. Peninsula’s expertise in company formation and tax advice can help you seize this moment, ensuring your business is structured to thrive amid these changes.
The Saudi government’s commitment to logistics is backed by impressive growth and investment. In 2024, the logistics sector contributed 6% to the kingdom’s GDP, with projections to reach 10% by 2030 under the National Industrial Development and Logistics Program (NIDLP). Over $100 billion has been invested in expanding ports, airports, railways, and highways, reflecting the scale of ambition behind Vision 2030.
Rail freight alone saw a 30% increase in volumes in 2024, driven by projects like the North-South Railway. Meanwhile, the demand for warehousing is expected to grow by an additional 10 million square meters by 2030. These figures highlight a sector on the rise—one that’s drawing global attention. For executives, they signal a market ripe for investment, provided you navigate the regulatory landscape effectively.
For companies in manufacturing, retail, or distribution, the Saudi Landbridge offers practical benefits. Direct freight access from King Abdullah Port to Riyadh cuts transit times and costs, while upgraded connections to Dammam and Yanbu open new supply chain options. If your business relies on moving goods across the kingdom, or into neighboring GCC markets, this project could redefine your operations.
Beyond logistics, the Saudi Landbridge reflects the kingdom’s broader push to attract foreign investment. Saudi construction projects like this one create demand for expertise in engineering, technology, and project management, sectors where international firms can play a role.
With the design tender underway, the Saudi Landbridge is on track to move into construction planning by mid-2026, assuming financing is secured. Whether funded through government resources, PPPs, or a hybrid model, this Giga project will shape Saudi Arabia’s economic future. For executives, the timeline offers a window to prepare, whether that’s establishing a presence now or positioning for opportunities as construction ramps up.
The question of financing remains a wildcard. Saudi Arabia’s willingness to explore multiple options suggests a pragmatic approach, but it also highlights the importance of staying informed. At Peninsula, we monitor these developments closely, ensuring our clients, from SMEs to multinationals, have the insights needed to act decisively.
As Saudi Arabia pushes forward with Vision 2030, the business landscape will continue to evolve. The Saudi Landbridge isn’t just a railway, it’s a symbol of the kingdom’s ambition and a catalyst for your success. Let’s build your future in Saudi Arabia together.
Alistair Paine brings 15 years of dedicated experience in Saudi market entry, guiding Fortune 500 companies and innovative scale-ups through successful establishment in the Kingdom. His expertise in Saudi company formation, licensing and market entry strategy, positions him as a leading authority and consultant in international business expansion to Saudi Arabia.
Schedule a free consultation with Alistair and the Peninsula team to understand which market entry strategy is best suited to your business setup in Saudi Arabia.
Email: Alistair@peninsulacs.com
