EV maker Lucid Motors is set to deliver 100,000 vehicles to the Saudi government, over the course of a decade.
On April 26, Lucid announced that they have assigned an agreement with the Government of Saudi Arabia wherein they will deliver a minimum of 50,000 EVs over a period of 10 years, with an option to raise it by another 50,000.
The delivery of the electric vehicles is expected to start no later than the second half of 2023.
Initially, the company is expected to deliver around 1,000 to 2,000 vehicles annually and gradually raise it to between 4,000 and 7,000 starting in 2025.
The Saudi ministry of finance shared their thoughts about the venture in a written statement. “This agreement is a significant move that supports the key objectives of Vision 2030 including diversifying and transforming the economy, society and lives of the people of Saudi Arabia, building new sectors fit for the future and creating skilled jobs for future generations. It also comes in alignment with the Saudi Green Initiative and the Middle East Green Initiative.”
Saudi Arabia has plans to convert at least 30% of vehicles in its capital, Riyadh, to EVs by 2030.
How much does Saudi Arabia own of Lucid?
The federal Government of Saudi Arabia has invested in Lucid through the Public Investment Fund. The Public Investment Fund, also called PIF, owns nearly 62% of Lucid Motors.
The California-based company had plans to put Lucid Air into production as early as 2018. But it ran into a common problem faced by most EV start-ups. The company struggled to find adequate funding. In this hour of need, the Saudi government stepped up to be its savior.
In 2018, the Public Funding Fund, which is the Saudi Arabian sovereign investment fund, invested nearly $1 billion into Lucid, before it became a publicly traded company. The investment was meant to fund the final engineering and testing of the Lucid Air and the construction of the company’s manufacturing plant in Arizona.
Mohammed bin Salman, the crown prince of the Kingdom, has invested heavily in startups as the country tries to diversify its portfolio, moving away from oil.
In July 2021, the PFI made record profits after Lucid Motors went public. Lucid stock became prime property overnight.
Is Lucid Motors building a factory in Saudi Arabia?
In a written statement, Peter Rawlinson, Lucid’s CEO and CTO mentioned that the company is “delighted to be to be supporting Saudi Arabia in achieving its sustainability goals and net zero ambitions, as outlined by Saudi Vision 2030 and the Saudi Green Initiative, by bringing our advanced luxury EVs to Saudi Arabia.”
As per the agreement, the Saudi government will purchase electric cars, including Lucid Air and other future models, that will be built at its Arizona factory and proposed international manufacturing facility in Saudi Arabia. This will help the Kingdom provide multiple job opportunities and economic benefits, which are in line with its Vision 2030.
The Kingdom’s finance ministry mentioned that they selected Lucid Motors “as they are building a factory to assemble these vehicles within the Kingdom, which will transition over time to full time production.” The manufacturing plant is expected to have a production capacity of up to 150,000 Lucid EVs every year.
The statement also added that this move will help the Kingdom move forward with its vision for the future, where it aims to become a major regional and global manufacturing hub for EVs. The Saudi government clarified that this order will give them an opportunity to work with Lucid Motors as they develop newer models. It will also help them share ideas and build EVs better suited to the government’s needs.
