Jaguar Land Rover (JLR) has made moves to start building cars in Saudi Arabia.
A letter of intent has been signed between the Indian-owned firm and the Saudi Arabian government, paving the way for a partnership.
Exploratory discussions about potential investment in Saudi Arabia follows Jaguar Land Rover's recent joint venture announcement with Chery Automobile Company to manufacture vehicles at a new plant near Shanghai, China, and the separate expansion of the firm's assembly plant at Pune, India.
The firm said the expansion plans follow a sharp rise in Jaguar Land Rover sales to emerging markets, contributing to a 32 per cent increase in global retail sales to 324,184 vehicles in the 11 months to November.
In the current calendar year, sales in the Middle East and North Africa have increased by more than nine per cent to 11,418 units.
Dr Ralf Speth, JLR CEO, said: "We are committed to further international partnerships to meet record demand for our highly sought-after vehicles.
"The Kingdom of Saudi Arabia is an attractive potential development option, complementing our existing advanced facilities in Britain and recent manufacturing plans to expand in other countries, including India and China."