Lucid’s struggles don’t dampen Saudi’s EV ambitions

Lucid's Jeddah plant construction continues
Lucid’s struggles don’t dampen Saudi’s EV ambitions
Saudi's PIF remains committed to Lucid investment

Lucid Motors, the US-based electric car maker, has faced significant losses since Q1 of 2020, with net accumulating losses exceeding $4.6 billion. Despite Lucid’s financial struggles, the Public Investment Fund (PIF) of Saudi Arabia, which owns a 60.46% stake in the company, remains committed to its investment.

The PIF has invested around $3.6 billion in Lucid since 2018 and has agreed with the company to purchase up to 100,000 of its vehicles over the next ten years.

Read more: Lucid secures $3.4 bn to set up first EV factory in Saudi

Lucid is critical to the Kingdom’s ambitious Vision 2030 plan, which aims to reduce the country’s dependence on oil revenue and diversify its economy.

The Fund is driving this plan and is expected to contribute 1.2 trillion riyals ($320 billion) to non-oil GDP through its portfolio companies and create 1.8 million new jobs between 2021 and 2025.

While Lucid’s first-quarter revenue fell short of analyst forecasts and its 2023 production outlook was cut, the company’s importance to Saudi Arabia’s EV plans remains unchanged.

Construction of Lucid’s Jeddah plant, which aims to reach peak production of up to 155,000 cars a year, is underway, and the government-owned Saudi Industrial Development Fund has loaned the company about $1.4 billion in 2022.

Moreover, plans for a new Saudi EV maker, Ceer, a joint venture with Apple supplier Foxconn, are also in the works and are expected to contribute $8 billion to Saudi GDP by 2034.

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