We are deeply committed to the localization of technology, which is essential for sustaining long-term growth, generating job opportunities, and nurturing local talent. Zamil Industrial is not only a key component of the broader Zamil Group’s corporate strategy but also a driving force behind our commitment to fostering economic development and social responsibility.

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Founded in 1998 in Dammam, Saudi Arabia, Zamil Industrial Investment Company (Zamil Industrial) has become a cornerstone in advancing Saudi Arabia's Vision 2030 by providing innovative engineering solutions in the construction industry. Their efforts are instrumental in reducing the nation's dependency on oil and fostering economic diversification.

Innovating Construction Solutions

Zamil Industrial excels in producing a variety of construction-related products and services. Their offerings range from pre-engineered steel buildings to sophisticated air conditioning and climate control systems suitable for a diverse array of applications. They also extend to telecommunications towers, process equipment, and advanced building materials like precast concrete and insulation products.

Sustainability and Global Reach

Aligned with the sustainability goals of Vision 2030, Zamil Industrial also contributes to the renewable energy sector, especially in solar power projects, underscoring their commitment to sustainable development. With a market presence in over 90 countries and manufacturing facilities across Saudi Arabia, UAE, Egypt, India, and Vietnam, Zamil Industrial blends global outreach with impactful local contributions.

Zamil Industrial not only supports Saudi Arabia’s economic growth through high-quality products and services but also plays a pivotal role in the environmental and industrial advancement of the nation, making them a key player in the realization of Vision 2030 objectives. Their global operations and local impacts underscore their commitment to innovation and sustainability in the construction industry.

In this exclusive interview with Ahmed Zaatari, CEO of Zamil Industrial, we explore various facets of the company's operations, including its significant contributions to Saudi Arabia's Vision 2030. We delve into Zamil Industrial's strategic approach to innovation, their commitment to fostering an inclusive workplace culture, and the implementation of robust Environmental, Social, and Governance (ESG) practices.

Ahmed Zaatari holds a bachelor's degree in Electrical Engineering from the University of Buffalo, New York. He is an accomplished business executive with extensive senior-level national and international management experience in all aspects of P&L operations, including strategic planning, business development, IT, digital transformation, turnarounds, business process optimization, and operational efficiency.

Ahmed joined Zamil Air Conditioners in 2003 and held the position of VP until 2015. He was promoted to President of the HVAC sector in 2023.

Ahmed Zaatari shares insights on how Zamil Industrial is not only aligning with but also actively driving the national agenda towards economic diversification and sustainable development. He discusses the innovative solutions and technologies that have positioned Zamil Industrial as a leader in the industrial sector, and how these advancements enhance the company's competitive edge globally.

Moderator:  the Zamil group has a rich history that dates back to the 1920s with significant milestones, such as being the first family company listed on the Saudi Arabia Stock Exchange. It has deep roots in Saudi Arabia society. What are the core principles and values that have made the company such an ongoing success throughout the years?

Participant: The Zamil family has consistently demonstrated exceptional corporate citizenship, exemplified by their relentless efforts to continuously refine and enhance the company’s strategic direction, products, and services. Zamil Industrial, a cornerstone of the Zamil Group, operates across a diverse range of industries and product lines. Our primary focus is on delivering top-quality products and services while providing employment to thousands of individuals. 

We are deeply committed to the localization of technology, which is essential for sustaining long-term growth, generating job opportunities, and nurturing local talent. Zamil Industrial is not only a key component of the broader Zamil Group’s corporate strategy but also a driving force behind our commitment to fostering economic development and social responsibility. Our vision is to remain a pillar of strong corporate citizenship for many years to come, contributing positively to the communities we serve and the industries in which we operate.

Moderator: And Zamil Industrial has diversified into various sectors, such as air conditioning, steel, glass processing. How does the company manage to maintain its competitive edge across such a diverse range of industries and what synergies have been created throughout this diversification?

Participant: That’s a great question. Zamil Industrial is a market leader in delivering integrated solutions—with a strong emphasis on the word "integrated." We specialize in the manufacturing, utilization, and servicing of a wide range of building materials, including steel, precast concrete, insulation, air conditioning systems, controls, firefighting equipment, solar solutions, electrical components, and decking products. What makes us unique is that we don’t just produce and sell these materials; we also use them in various construction projects, whether they’re commercial or industrial.

When we break down our business, manufacturing accounts for roughly 20%, construction another 20%, and services—including aftermarket services—about 10%. In terms of product categories, steel represents around 50% of our business, air conditioning contributes between 25-30%, construction about 15-20%, and insulation approximately 4-5%.

Our true competitive advantage lies in our ability to provide integrated solutions. In today’s market, many international companies and developers, particularly those involved in high-spec projects, expect local providers to meet stringent technical specifications, offer competitive pricing, and deliver top-notch aftermarket services. Rather than sourcing materials from multiple suppliers, these clients prefer to work with a single company that can offer a comprehensive package. That’s where Zamil Industrial excels. We provide premium products, integrated solutions, and exceptional services, all under one roof—this is what truly sets us apart in the industry..

Moderator: And talking about innovation, which is the main theme of this report, integrating technologies such as IoT, cloud computing, artificial intelligence, machine learning to improve the manufacturing and operations, to ensure optimized performance. How does Zamil Industrial approach innovation? For example, in AC or steel, could you share some of the key strategies or innovations that have driven the success over the years?

Participant: Certainly. Innovation is essential to sustaining and enhancing our competitive edge. For Zamil Industrial, innovation revolves around three main areas. First is advanced coating. Every product we manufacture has a specialized coating to ensure longevity, durability, and corrosion resistance, and we apply this coating using robotic systems. Second is smart manufacturing. This involves using data-driven technologies to optimize production and improve product quality. We use sensors, analytics, monitoring systems, and process control tools to achieve this. The third area is robotic automation, which we apply to repetitive and hazardous tasks in manufacturing. For example, we use robotics in welding, casting, and furnace operations, which improves efficiency, product quality, and employee safety, particularly when handling heavy materials like steel. We also incorporate advanced design technologies in our air conditioning products, using cutting-edge materials to maximize energy efficiency. Our AC products are among the most energy-efficient on the market, allowing us to remain competitive, especially in high-specification projects.

Moderator: With the global steel industry facing challenges such as FLUCTUATING RAW MATERIAL PRICES and environmental concerns, how is Zamil Steel addressing these challenges to maintain cost efficiency and sustainability in its operations?

Participant: Great question. We tackle these challenges in several ways. First, we manage material costs by making informed purchasing decisions based on market insights, thanks to our strong relationships with consultants, customers, and contractors. This gives us a clear view of market demand and helps us strategically time our purchases. Second, in terms of product utilization, we implement advanced automation and technologies to increase production volume, improve operational efficiency, and enhance profit margins. This also allows us to meet the growing demand for fast-track projects, ensuring that our products and materials are delivered on time to meet tight schedules.

Moderator: . Zamil Central Air Conditioners recently signed a Memorandum of Understanding with Mitsubishi Heavy Industries Thermal Systems during the Saudi-Japanese Roundtable Meeting 2023. How does this partnership align with Zamil Industrial’s long-term strategic goals, and what specific benefits do you anticipate from collaborating with a global leader like Mitsubishi Heavy Industries?

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Participant: That's a great question. Our relationship with Mitsubishi actually goes back several years. This partnership enables us to manufacture Mitsubishi’s centrifugal chillers in Saudi Arabia, incorporating a high level of local content, which aligns with the government’s initiative to localize technology in the country. From a manufacturing perspective, this collaboration helps us comply with these government directives. In terms of demand, there are several factors driving the need for centrifugal chillers. First is the rise in urbanization. As more people move into cities, the demand for cooling systems shifts from individual units for villas or apartments to larger-scale solutions for bigger complexes, where district cooling becomes essential.

Mitsubishi’s centrifugal chillers are the best in the market for district cooling, offering top-tier energy efficiency. Secondly, with the Saudi government investing heavily in entertainment hubs and smart cities, district cooling systems are the most effective solution, and Mitsubishi’s products are best in class for these types of projects. Lastly, Mitsubishi’s products complement Zamil Industrial’s strength in offering comprehensive, integrated solutions. We design, supply, integrate, test, operate, and maintain cooling systems, particularly for district cooling. We’ve been a strong player in the district cooling market for years, and this partnership with Mitsubishi enhances our competitiveness for the long term.

Moderator: Yes. And the objective of this publication is to create partnerships, whether it's commercial investment, know-how, technology driven. What opportunities do you foresee? If you look at France and the US where this report is going to circulate in the future, what opportunities for joint venture do you see in the future?

Participant: Absolutely. Before I address that, I’d like to mention that we already have a joint venture with Samsung for VRF products, which are manufactured in Saudi Arabia and are highly energy-efficient for comfort cooling in both small buildings and residential spaces. Now, regarding France, although we're under NDA, I can highlight three initiatives we are exploring with French companies. First, we're in discussions with a company in the defense and security sector, focusing on systems cooling, which is crucial in this industry alongside comfort cooling. Second, we’re exploring energy solutions, particularly related to district cooling. Greater efficiency in district cooling systems results in cost savings and higher profitability, and we’re working with a French company in this area. Third, we are talking with another French company about data-driven manufacturing operations, which is a key area of innovation for us. In the US, we’ve recently engaged with two companies. One specializes in reducing microbial and other contaminants to improve indoor air quality—an increasingly important issue as urbanization intensifies. This company is top-tier, and we’re working to incorporate their solutions into our manufacturing and service offerings. The second is focused on advanced heat transfer technology, which is critical for air conditioning efficiency. We're collaborating with this company to enhance our heat transfer processes. In addition, we’re in discussions with a company in Spain about integrating solar-powered AC systems that can harvest drinking water from the environment. This is particularly relevant for Saudi Arabia’s humid coastal regions, and we’re in early talks to explore how this technology can be implemented, distributed, and serviced in Saudi. These examples reflect the broad scope of collaborations we’re pursuing in France, the US, and beyond.

Moderator: And you mentioned the environment. The world now is moving towards increased adoption of environmental, social and governance ESG across all sectors of the economy. What steps is AlZamil taking to integrate sustainable practices into its operations? And also, how are you adapting an ESG-driven approach throughout the whole company value chain?

Participant: Great question! Let’s start with the basics. We are currently using solar systems at our manufacturing plants to generate electricity from solar arrays. This allows us to harness renewable energy for our operations. Additionally, we are designing and implementing solar products for projects in Saudi Arabia, which is a rapidly expanding business venture for us. We consider ourselves one of the leading providers of solar projects in the country, collaborating closely with Tarshid, a government entity focused on enhancing energy efficiency in public projects. Solar energy is a significant focus for them, and we are a key partner in that initiative. Beyond this, we are utilizing advanced technologies to develop more energy-efficient air conditioning products. Furthermore, increased automation in our manufacturing processes allows us to reduce production time, which in turn lowers electricity consumption in our plants. In summary, these four initiatives—solar energy usage in our facilities, solar project implementation, enhanced energy efficiency in our products, and automation—collectively represent our commitment to energy management and sustainability in Saudi Arabia.

Moderator. Absolutely. You’ve previously mentioned the significant investments in mega projects and smart cities. As these initiatives grow, investing in human capital will be crucial to support this development. I’d like to delve into the topic of human capital, which I believe is a company’s most valuable asset. How are you fostering an ecosystem that attracts and nurtures top talent? Additionally, what are your thoughts on Saudization and the empowerment of women in the workforce?

Participant: Excellent question! Let’s start with empowering women. Zamil has a long history of integrating women into our light manufacturing and conversion processes. We were among the pioneers in this regard. Today, we’ve expanded their roles to encompass all areas of our operations, including manufacturing, engineering, servicing, and shared services. We see women as valuable talent rather than just a demographic, and their contributions have significantly enhanced our company. We are committed to further expanding their involvement, as they are a key competitive advantage for us. Now, when it comes to talent management, our approach applies to all employees. Our competitive edge lies in our people, and we focus on upskilling them through technical training in various areas—factories, services, sales, marketing, engineering, and finance. We also have a new initiative to identify potential leaders within the company. This program will send selected individuals overseas for intensive training lasting eight to ten months, after which they will return to assume leadership roles. We have already identified over 100 candidates, and we expect to roll out this program in Q1 2025. Training alone isn’t enough; we are a performance-driven company. Every employee has KPIs, and we have an attractive variable incentive plan to encourage development and enhance contributions to the company’s performance. This plan is applied across the board. In summary, we focus on training, incentivizing, measuring performance, and continuously improving, and we’re pleased with the progress we’re making.

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Moderator: Interesting. And how many people work in Al-Zamil? What is the workforce?

Participant: We currently have over 7,000 employees, and in total, across all sectors including construction, we employ about 11,000 people.

Moderator: Considering the scale of Zamil, with 11,000 employees and operations across various sectors, I’d like to shift focus to leadership. What are the key challenges you face in leading a company of this size? What are the day-to-day obstacles you encounter?

Participant: Leadership challenges are prevalent in any organization, but we see them as exciting opportunities. Right now, there’s a significant demand for products and services, particularly in building materials. As this demand attracts global players, we’re seeing top-tier companies setting up operations here, which shifts the competitive landscape. In the past, we primarily competed with local and regional firms, but now we’re up against the best in the world. This requires us to undergo a fundamental transformation—not just in appearance or gender representation, but in our core identity. We must focus on performance, internal competition, skill development, and effective skill management. This transformation needs to happen quickly as we face increasing competition from new entrants trying to capture our market share. Therefore, we prioritize our people, systems, and processes. Our ongoing transformation efforts encompass upskilling, development, incentives, process automation, and system improvements. We are optimistic about our current position and where we expect to be in the coming years.

Moderator: Yes. And I have a question on governance. In an era of increased shareholder and public scrutiny, corporate boards must lead with more efficiency, expediency, and transparency than ever before. What is Zamil's approach to good governance?

Participant: That’s an excellent question. As a publicly traded company, Zamil Industrial is fully compliant with Saudi regulations as well as our own corporate policies and procedures. We have an independent internal audit organization that reports directly to an audit committee and is involved in all operational aspects. Their role extends beyond auditing; they also provide valuable advice and consultation, enhancing the effectiveness of our operations. In addition, we view various functions within the company—such as IT, legal, internal audit, marketing, finance, and our center of manufacturing excellence—as internal consultants. By integrating these functions, we ensure that our operations adhere to compliance requirements while also driving improvement across the organization.

Moderator: Where do you see Zamil in five years’ time? What are the main challenges and opportunities you foresee for the company?

Participant: We recently completed a 25-year strategic plan, and we expect demand to keep rising, along with increased competition and a growing need for labor training. There will also be a greater demand for specialized experts, not just from the local market but from international sources as well. Consequently, our focus will remain on developing our workforce, refining our processes, and enhancing our systems. With expanded automation in manufacturing, technical training for our products and services, and the recruitment of high-caliber executives, we believe not only will we perform well, but we will likely exceed our current achievements.

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Moderator: Interesting. And we talked about leadership just before, how would you define leadership? What makes a good leader in your opinion?

Participant: Great question! A good leader is insightful, resourceful, and systematic. We don't just value leadership; we believe it should be complemented by effective management. Leadership alone is not enough. We seek leaders who can design, articulate, and drive implementation. Our company has numerous initiatives, so a leader must not only orchestrate the vision, communication, mission, and strategy but also be actively involved in executing these plans. Essentially, we need leaders who are also drivers of action.