AutoWorld, also known as Al-Jazira Equipment Company, was valued at US$ 121 million. This deal was completed by Al Jozoor Al Rasekha Trucking Company, a subsidiary of Budget Saudi.
What is the strategic step Budget Saudi is aiming at? It is already a giant in the transportation sector in the country. Let us take a quick look at Budget Saudi’s background.
An Overview:
Budget Saudi was founded in 1978 in a single rental office with 20 cars and a small team of 15. Over the decades, it has earned the position of a leading transportation provider in Saudi Arabia.
Currently, the company has more than 37,000 vehicles in its fleet covering the entire kingdom and a huge customer base. This customer base comprises private corporations and government entities. Its strategic focus is expanding its client base with customer-centric services and policies.
Here is how this transportation brand is planning to become a market leader-
Budget Saudi’s Pre and Post-acquisition Capital Statistics
Budget Saudi now has a clear idea of how this acquisition step is catapulting this transportation brand to a new level. Here is a gist of its acquisition details to get a broader view.
The Financial Performance So Far
Budget Saudi’s financial status is quite impressive as it has reported an increase of 39.5% in revenue in the first quarter of 2024. It has reached SAR 416.8 million ($111.1 million) compared to SAR 298.7 million ($79.6 million) in the same period last year and a market cap of SAR 7 billion on the Saudi Stock Exchange.
As per the company officials, this marvellous growth has resulted from:
- Stable fleet utilisation rates
- Short-term rental revenue increase
The company also anticipates a better financial performance in the upcoming quarters after this acquisition.
Green Nation Initiative: Aligning with KSA’s Vision 2030
Budget Saudi is aligning with Saudi Arabia’s Vision 2030 by adopting a sustainability-focused approach in all aspects of its operations. From logistics to customer service, the company is dedicated to preserving natural resources for future generations.
Here is how they are doing it.
- Carbon-Neutral Vehicles: The company minimises environmental impact by using top-rated, carbon-neutral vehicles and adopting low-emission practices.
- Engine Oil Reduction: Budget Saudi reduced petrol engine oil consumption by 56%, from 588,000 to 258,000 litres, through the exclusive use of high-efficiency lubricants.
- Hybrid Fleet Expansion: Plans to replace more than 30% of the fleet with hybrid or electric vehicles by 2028. Its forklifts are already operating on electricity.
- Fuel Efficiency: Achieved a 32.98% fuel consumption improvement with vehicles operating at 18–20 km per litre.
- Eco-Friendly Car Wash: Utilises the Optima steamer that takes 50% less time and only 3 litres of water per wash compared to traditional methods.
- Recycling Initiatives: Collaborated with leading recycling vendors to implement recycling programs and contribute to waste management.
- Resource Savings: Budget Saudi’s office has saved 19.9 trees, 2.95 cubic metres of landfill space, and reduced greenhouse gas emissions by recycling 1,171 kg of plastic.
- Water and Energy Conservation: By recycling, Budget Saudi saved 8,197 gallons of water and 6,761.35 kilowatts of energy.
- Green Saudi Initiative: Part of the ambitious project to plant 1,000 trees in the Eastern Forest of Jeddah by 2024.
Additionally, Budget Saudi recycles approximately 190 tons of used engine oil annually and continuously revises its practices to meet sustainability objectives. The new low-carbon fleet will add additional points to Budget Saudi’s sustainability efforts in the coming years.
Corporate Social Responsibilities: How Budget Saudi is Setting an Example to Follow
Budget Saudi prioritises social responsibility through various employee-focused initiatives. It nurtures a supportive work environment to enhance the overall well-being of employees. Here are the key social responsibilities of the company:
- Employee Support Fund: A dedicated fund to assist employees during financial or personal challenges like unexpected medical expenses or educational pursuits.
- Employee Savings Program: A long-term savings initiative to help employees achieve financial goals. It includes post-retirement financial security, in collaboration with Riyad Capital.
- Workplace Culture: The company has been recognized as a “Great Place to Work.” It reflects its commitment to creating a positive and supportive workplace culture for employees.
- Volunteer Empowerment: Engages volunteers through the National Volunteer Portal to provide them with accredited certificates.
- Environmental Goals: Aimed at enhancing green cover in Jeddah to preserve biodiversity and combat climate change.
Budget Saudi actively contributes to community well-being and environmental sustainability through collaborative efforts. Creating such a nurturing space increases values among employers, employees, and communities.
Taking a Major Step towards a Brighter Future in KSA’s Transport Sector
Budget Saudi’s acquisition of AutoWorld strengthens its market position and accelerates its sustainability goals. It is set to become a leader in Saudi Arabia’s transportation sector, focusing on fleet expansion, carbon reduction, and employee well-being.
Aligning with Vision 2030, the company aims to drive sustainable growth and deliver long-term value to shareholders and communities alike.