California-based EV maker Lucid opens first-ever auto plant in Saudi Arabia
By Tom Foster
(CNN) — Californian EV-maker Lucid has opened the first ever car manufacturing plant in Saudi Arabia, as the kingdom looks to establish itself as a global player in the EV race.
Lucid officially opened the plant in King Abdullah Economic City, near Jeddah, on Wednesday. The factory — the company’s first international plant — will initially focus on re-assembling vehicle kits sent over from the United States.
“With the support of the Saudi government, we are proud to drive local development in the technology industry,” Lucid CEO Peter Rawlinson said in a statement. “We look forward to delivering Saudi-assembled cars to customers in Saudi Arabia and beyond.” Saudi Arabia’s powerful Public Investment Fund (PIF), controlled by the Saudi government, is Lucid’s largest shareholder.
The Saudi government also has an agreement with Lucid to purchase up to 100,000 vehicles from the company over a 10-year period.
The new factory will initially deliver Lucid vehicles that have already been put together at the company’s first factory in the United States, then disassembled for shipping, then re-assembled at the plant in Saudi Arabia. While the factory initially has an annual production capacity of just 5,000 vehicles, the company says it intends to begin from-the-ground-up production at the Saudi factory “after the middle of the decade,” with an additional annual capacity of 150,000 vehicles.
Saudi Arabia wants 30% of new car sales in the kingdom to be electric by 2030. The country has looked to electric vehicles as a way to boost its manufacturing sector as it faces an inevitable decline in demand for the oil it has relied upon, and has courted other western companies in the EV industry in the hope of diversifying its economy.
In 2022, the PIF set up a state-backed EV brand, called Ceer, which last month announced a deal with Siemens on designing and building electric cars. Earlier this month, The Wall Street Journal reported that Saudi Arabia had also held talks with Tesla over an EV factory in the kingdom. Tesla CEO Elon Musk dismissed the reports, however, saying they were “utterly false.”
For Lucid, the Saudi factory milestone comes during a turbulent period for the company, whose shares have struggled since its IPO in 2021. In March, the company laid off around 18% of its workforce as part of a cost-cutting plan. Lucid shares are down more than 60% over the past 12 months.
The-CNN-Wire
™ & © 2023 Cable News Network, Inc., a Warner Bros. Discovery Company. All rights reserved.
