Oman’s Automobile City Set to Launch Operations Next Year

Key Takeaways

Oman’s Automobile City project in Salalah will launch its first phase in Q2 2027, with nearly 50% of construction completed.
The initial phase, covering 53,000 square meters, is estimated to cost OMR6 million ($16 million) and will feature various automotive services.
The project aligns with Oman’s strategy to diversify its economy beyond oil production.

Automobile City Project in Salalah

Oman is set to open the first phase of its Automobile City project in Salalah by the second quarter of 2027. With close to half of the construction already completed, the project represents a significant investment in the automotive sector. Faisal Al Dheeb, managing director of Al Amal Al Daem International Company, confirmed that the initial phase will occupy 53,000 square meters and is budgeted at OMR6 million ($16 million).

The Automobile City, a collaborative initiative with Dhofar Municipality, aims to become an integrated hub for the automotive industry. The development will accommodate showrooms, dealerships, maintenance centers, as well as outlets for spare parts, tires, batteries, and financial services including insurance and banking.

Although the total project cost has not been revealed, it signals an important step in Oman’s efforts to diversify its economy. This initiative is part of a broader strategy as Oman seeks to reduce dependency on oil, which currently generates approximately 1 million barrels of crude oil per day.

In a related development, Salalah Global City Company has partnered with China’s Jiangsu Changhong Intelligent Equipment to establish an automotive factory in Salalah. This agreement was signed in November 2025 and reflects ongoing efforts to boost industrial activity in the region. In April, the state-owned Public Authority for Special Economic Zones and Free Zones also inked investment agreements totaling over OMR200 million to promote industrialization within Oman’s free zones.

As these projects progress, they highlight Oman’s commitment to developing a sustainable and diversified economy that can withstand fluctuations in oil prices and market demands.

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