Lucid Motors is in talks with Saudi Arabia’s sovereign wealth fund to build an electric vehicle factory near the Red Sea port city of Jeddah, according to a media report. A second location in the country is also reportedly under consideration.
Bloomberg reported the plans for the new factory in the Middle East citing people familiar with the matter. The Saudi sovereign wealth fund has already been a shareholder in Lucid Motors since 2018 and is said to be providing much of the money for the factory. Plans are at an advanced stage, but could still change, the company said. Besides Jeddah, the city of Neom in the northwest of the country is also being considered as a possible plant location.
Another factory, regardless of location, would mean a huge increase in capacity for Lucid. The plant in Casa Grande, Arizona, is expected to build up to 30,000 vehicles per year. If Lucid wants to get to unit numbers and economies of scale quickly after the planned start of production in spring 2021, 30,000 units may soon be insufficient.
Deliveries to US customers from the Casa Grande plant are scheduled to start in 2021, the first of which will be the top model of the Air, the so-called Dream Edition that is priced around at least $169,900. Later, the Grand Touring and Touring versions are to follow. The basic Lucid Air Pure version will join the lineup at the beginning of 2022 and be available from $69,900 by which time, unit sales will probably also increase significantly. An electric SUV is to follow.
According to Bloomberg, the plans for the plant do not call for it to be built in Jeddah itself, but in King Abdullah Economic City. This would put the factory around 100 kilometres north of the country’s second-largest city. That Lucid Motors is building its second site in Saudi Arabia, however, appears to be beyond dispute, according to the report, which said the 2018 billion-dollar investment was conditional on the company developing a site in the country.
The sovereign wealth fund’s investment in the electric carmaker and potential investment in the plant are part of the Saudi royal family’s mission now for the sovereign wealth fund: The government is trying to develop projects in its own country that will make the economy less dependent on oil. The Saudi sovereign wealth fund PIF was also invested in Tesla for a long time, but sold almost all of its shares in 2020.