Daikin, one of the world’s most respected names in heating, ventilation, air conditioning, and refrigeration (HVAC-R), is strengthening its presence in Saudi Arabia with the construction of a new, state-of-the-art manufacturing facility in Jeddah. The project marks a major milestone for the company’s regional expansion strategy and deepens its commitment to supporting Saudi Arabia’s industrial development. Built in partnership with long-term collaborator Tariq Almutlaq, Chairman of Daikin Saudi Arabia, this new facility symbolizes Daikin’s confidence in the Kingdom’s economic vision and long-term opportunities.
A Strategic Investment Aligned With Saudi Vision 2030
Saudi Arabia is undergoing one of the fastest transformations in the world. With rapid urban development, smart city projects, major tourism initiatives, and a clear mandate for sustainability, the demand for efficient cooling and advanced HVAC technologies has never been higher. Against this backdrop, Daikin’s decision to build a new facility in Jeddah comes at an ideal time.
The facility will support the Kingdom’s Vision 2030 goals, particularly those relating to job creation, industrial growth, technology transfer, and sustainable development. Large-scale infrastructure projects such as NEOM and the Red Sea development are creating new expectations for high-quality, energy-efficient cooling systems capable of performing under extreme climate conditions. Daikin aims to meet these expectations through localized production tailored specifically to the region.
A New Hub for Advanced Cooling Technologies
The Jeddah facility will specialize in the localized production of chillers and hydronic heat pumps. These systems are essential for large buildings, industrial complexes, hotels, hospitals, and mixed-use developments. By manufacturing these products within Saudi Arabia, Daikin is reducing reliance on imports, cutting delivery times, and offering more customization for regional clients.
Hydronic heat pumps and advanced chillers are becoming increasingly important as governments and businesses shift toward energy-efficient systems. The Middle East’s intense climate makes cooling a major contributor to energy consumption. By producing high-performance systems locally, Daikin is not only expanding its reach but also contributing to national energy efficiency goals.
Leadership Insights on Regional Impact
Claudio Capozio, Chief Operating Officer of Daikin Applied Europe, emphasized the strategic role of this facility. According to him, the manufacturing operations will follow the Production of Daikin System (PDS) Framework—Daikin’s globally recognized model for precision and consistency. This ensures that the Middle East receives the same quality and reliability as other established markets.
Capozio also highlighted that the facility will enhance Daikin’s capability to respond quickly to regional needs. By manufacturing closer to customers, Daikin can improve delivery timelines, reduce logistical costs, and introduce region-specific innovations more rapidly.
Shinji Jodo, Managing Director of Daikin Arabia Regional Headquarters, added that this investment is a continuation of Daikin’s long-term commitment to Saudi Arabia. After more than a decade of operations in the Kingdom, the company has built strong partnerships and played a role in supporting key national projects. The new Jeddah facility reflects Daikin’s focus on sustainability, innovation, and long-term industrial development.
Building on Previous Investments in the Kingdom
The Jeddah facility is the next logical step following Daikin’s earlier investment in Sudair Industrial City near Riyadh. The Sudair site demonstrated Daikin’s ability to help drive local employment, enhance technology transfer, and promote energy-efficient manufacturing. It also showed the benefits of establishing a production ecosystem inside Saudi Arabia, closer to major development zones.
With the new Jeddah plant, Daikin is expanding this ecosystem even further. The two facilities together strengthen the company’s presence across both central and western regions of the Kingdom, ensuring broader national coverage and better support for ongoing megaprojects.
Adhering to the Production of Daikin System (PDS)
One of the defining features of the new facility will be its strict adherence to the Production of Daikin System (PDS). This globally recognised manufacturing framework is built around three key principles: lean production, continuous improvement, and stringent quality control. It ensures that every product leaving the factory is reliable, durable, and optimized for performance.
The integration of PDS will include:
- Highly organized production lines designed to maximize efficiency
- Advanced quality control checkpoints
- Productivity systems that reduce waste and increase output
- A focus on product consistency across all manufacturing stages
Additionally, the plant will feature dedicated laboratories and test benches for comprehensive Factory Acceptance Testing (FAT). Before any unit is shipped, it will undergo thorough inspection to ensure performance, durability, and compliance with regional operating conditions. This testing capability is essential in the Middle East, where HVAC systems must withstand high temperatures, humidity, and extended operational hours.
Supporting Local Production for Local Needs
Daikin’s expansion strategy in the Middle East emphasizes “local production for local consumption.” This approach is increasingly important as the Gulf region experiences rapid growth in urban development, infrastructure, and industrialization. By producing systems in Jeddah rather than importing them, Daikin can deliver products that are better tailored to climatic conditions and industry requirements within the Kingdom and neighboring countries.
Local production also expands job opportunities for Saudi talent. The new facility will create roles in engineering, manufacturing, quality management, and technical support. Daikin will also invest in training programs to ensure local professionals are equipped with the technical skills necessary to operate advanced HVAC-R production systems.
Boosting Saudi Arabia’s Industrial and Manufacturing Capabilities
Saudi Arabia aims to position itself as a major manufacturing hub in the region. Daikin’s new facility contributes directly to this ambition by introducing sophisticated manufacturing technologies and enhancing the Kingdom’s industrial capabilities.
The presence of a global HVAC leader reinforces the competitiveness of the Saudi manufacturing sector. It also encourages more global companies to consider establishing local operations, especially as the Kingdom continues to expand its industrial zones, free zones, and economic clusters.
A Facility Positioned for Long-Term Growth
The Jeddah manufacturing facility is designed with long-term expansion in mind. Daikin has outlined a gradual ramp-up strategy that aligns with regional market growth. The facility will initially focus on producing large, air-cooled chillers, which are widely used across commercial and industrial sectors in the Middle East.
In the future, Daikin plans to expand the product portfolio based on evolving market needs. As the Kingdom advances toward net-zero and green-building targets, demand for innovative cooling technologies, sustainable refrigerants, and high-efficiency systems will increase. The new facility will be positioned to support this transition.
Strengthening Daikin’s Regional Network
Daikin has been steadily expanding its manufacturing footprint in the region over the past decade. The company established its first regional factory in the UAE in 2014, followed by the Saudi facility in Sudair in 2022. The new Jeddah facility marks another step in this expansion and strengthens Daikin’s capability to serve customers across the Gulf and wider Middle East.
This network of facilities ensures:
- Faster service and product availability
- Better support for large government and private-sector developments
- Reduced dependence on imported equipment
- Improved customer engagement through regional technical teams
As demand grows in countries such as Saudi Arabia, UAE, Qatar, Kuwait, and Bahrain, Daikin’s regional presence becomes even more valuable.
Driving Sustainable Innovation in the Middle East
Sustainability is a core focus for both Daikin and Saudi Arabia. Cooling accounts for a large percentage of energy usage in the region, making the shift to energy-efficient systems essential for environmental and economic goals. The new facility will enable Daikin to produce equipment that meets and exceeds new energy-efficiency regulations across the Gulf.
Hydronic heat pumps, for example, offer significant energy savings and reduce reliance on traditional cooling methods. Similarly, advanced chillers designed for the Middle East can deliver long-term performance with lower energy consumption. Daikin’s expertise in green technologies aligns perfectly with Saudi Arabia’s push toward cleaner and more sustainable development.
A Milestone for Regional Economic Progress
The new manufacturing facility is more than just a business expansion; it is a major contribution to Saudi Arabia’s economic transformation. By establishing local production, creating jobs, and strengthening the industrial base, Daikin is playing a role in shaping the Kingdom’s future.
The move also supports the Kingdom’s goal of becoming a regional leader in advanced manufacturing. With global companies like Daikin participating in this mission, Saudi Arabia is moving steadily toward creating a diversified, innovation-driven economy.
Conclusion
Daikin’s new manufacturing facility in Jeddah stands as a powerful symbol of the Kingdom’s growing industrial capabilities and the company’s long-term commitment to the Middle East. By focusing on advanced cooling technologies, local production, and high-quality manufacturing processes, Daikin is positioning itself as a key partner in the region’s development journey.
This strategic investment supports major national projects, global sustainability goals, and the rising demand for energy-efficient solutions. As Saudi Arabia continues to expand its infrastructure and embrace new technologies, Daikin’s new facility will play an essential role in shaping the future of cooling in the region.
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