Saudi Public Investment Fund (PIF) is committed to EV projects

Saudi Arabia’s Public Investment Fund (PIF) has been signaling serious intent when it comes to transitioning to electric vehicles (EVs), with major funding of joint ventures and new projects in the EV sphere.

That includes supporting and creating new EV brands such as Lucid Motors and Ceer, establishing the Kingdom’s first car manufacturing plants with Lucid, Hyundai and Ceer; as well as contributing to setting up and establishing an EV ecosystem in the country at pace, with the establishment of entities such as Tasaru Mobility Investments.

This is all part of PIF’s broader strategy to diversify the economy and reduce reliance on oil, which aligns with Saudi Arabia’s Vision 2030 goals.

Lucid Motors assembly plant

Lucid Motors is an American car company dedicated to producing EVs. The company’s first car, the Lucid Air luxury saloon has been well-received in its home market of California. PIF owns more than 60% of Lucid Motors, making it the majority stakeholder in the company.

And in a historic first for Saudi Arabia, a car manufacturing plant has been established in King Abdullah Economic City near Jeddah. The initial phase involves re-assembling Lucid Air vehicle kits.

The Lucid assembly plant in King Abdullah Economic City near Jeddah.

With the plant beginning operations in September 2023, by December nearly 800 cars had rolled out of the plant as 200 employees were trained in preparation for ramping up production to 5,000 cars a year initially.

Lucid’s Global Vice-President, Faisal Sultan, told Reuters that the “car is fully built in Arizona, then de-assembled and shipped as a kit”. Workers at the new plant, reassemble the cars, re-attach the battery, and finally re-test the vehicles before delivery.

The plant aims to eventually reach an annual production capacity of 150,000, while the Saudi government has pledged to buy 100,000 Lucid vehicles over 10 years, including a fleet of Lucid Air police cars. The Air was revealed in police livery at the World Defence Show in Riyadh earlier this month.

His Royal Highness Crown Prince Mohammed Bin Salman Bin Abdulaziz Al-Saud is a keen supporter of the EV transition.

Ceer Motors – Saudi Arabia’s first EV brand

Ceer Motors is Saudi Arabia’s first homegrown EV brand, created in a joint venture between PIF and Taiwan’s Foxconn. Ceer aims to design, manufacture, and sell a range of vehicles, including sedans and SUVs, for the Saudi and MENA (Middle East and North Africa) markets, utilizing technology licensed from BMW.

The company is set to employ 30,000 people and contribute $8 billion to the Saudi Economy by 2034. His Royal Highness Crown Prince Mohammed Bin Salman Bin Abdulaziz Al-Saud said: “Saudi Arabia is not just building a new automotive brand, we are igniting a new industry and an ecosystem that attracts international and local investments, creates job opportunities for local talent, enables the private sector, and contributes to increasing Saudi Arabia’s GDP over the next decade, as part of PIF’s strategy to drive the economic growth in line with Vision 2030.”

Hyundai automated car plant in KSA

PIF has entered into a joint venture with Hyundai Motor Company to establish a highly automated car manufacturing plant. Hyundai has previously stated its intention to become a top three EV producer globally, with 31 electric models to be introduced by 2030.

The joint venture aims to produce 50,000 vehicles per year in Saudi Arabia, which will include petrol-engine vehicles as well as EVs. Over $500 million is expected to be invested in the facility which is set to break ground in 2024 and begin production in 2026. PIF will hold a 70% stake.

This venture will create thousands of jobs and facilitate the transfer of knowledge and expertise, enabling accelerated progress of Saudi Arabia’s nascent automotive industry​​​​.

Tasaru Mobility Investments and EV Ecosystem

PIF has also launched Tasaru Mobility Investments, a company focused on the development of the Kingdom’s EV and autonomous mobility ecosystem. Tasaru aims to localize manufacturing and technology, support research and development, and adopt advanced technologies in the automotive sector. This includes establishing an automotive logistics hub in King Abdullah Economic City.

Saudi Arabia has also announced a $6 billion investment in a steel complex and an EV battery metals plant as part of a broader effort to lure investments into the mining sector – a crucial part of the EV supply chain. These investments are expected to create over 14,000 jobs​​.

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18 Feb, 2024