Saudi Arabia’s Public Investment Fund (PIF) has committed $1 billion to electric vehicle maker and Tesla challenger, Lucid Motors.
The investment follows Elon Musk’s decision not to take Tesla private with the fund’s help in the summer.
The agreement is a major breakthrough for California-based Lucid, positioning it to challenge Tesla’s dominance in premium electric vehicles and bring its first car to production in 2020.
The funding will enable Lucid to complete development and testing of its Lucid Air vehicle, construct a $700 million factory in Casa Grande, Arizona, and begin rolling out its North America retail strategy, before finally entering mass production.
From Lucid dream to reality
Founded in 2007, Lucid Motors has taken a long time to launch its first car. However, with an expected range of over 400 miles, 0-60 mph in under 2.5 seconds, and a claimed top speed of over 200 mph, the Lucid Air promises to be in the vanguard of electric vehicle performance and luxury – with a price to match, perhaps.
The company will also include autonomous driving hardware with over-the-air updates. Lucid previously announced that the technology will be provided by Mobileye, a company that claims to have more than a 70 percent market share of the driver-assistance technologies used by 27 million cars on the road.
Peter Rawlinson, chief technology officer of Lucid Motors, said:
The convergence of new technologies is reshaping the automobile, but the benefits have yet to be truly realised. This is inhibiting the pace at which sustainable mobility and energy are adopted. At Lucid, we will demonstrate the full potential of the electric connected vehicle in order to push the industry forward.
A spokesperson for Saudi Arabia’s sovereign fund added: “By investing in the rapidly expanding electric vehicle market, PIF is gaining exposure to long-term growth opportunities, supporting innovation and technological development, and driving revenue and sectoral diversification for the Kingdom of Saudi Arabia.”
Internet of Business says
With oil a finite resource and the electric vehicle market set to boom in the coming decades, Saudi Arabia needs to diversify its economic base.
Given that Lucid Motors hasn’t even started production on its first vehicle, the Investment Fund is playing the long-game, betting on the greatest risk-reward.
However, the deal will be seen by many in the light of the Tesla discussions earlier this year, which saw Musk take to social media to store up a world of unnecessary problems for himself. A sign, perhaps, of a leader who needs high-octane problems to solve – even if he has to invent them himself.
Musk said he wanted to take Tesla private to focus on long-term strategy, and suggested (via Twitter) that the PIF funding to do just that was in the bag. Then, two weeks later, he wrote a blog post announcing that Tesla would remain public.
Musk’s actions are still under investigation by the US Department of Justice, despite the abandoned Saudi deal, while he is also being sued for libel for some other ill-advised tweets.
Since then, some have linked Tesla to Apple: a shared vision for technology and design, perhaps, but an epic clash of personalities should that deal ever be made.
With Tesla off the table and Musk battling his own reputation, the PIF turned to Lucid Motors. So with a $1 billion investment about to be secured, California now has another major contender in the electric vehicle space.
With the enormous future market for EVs, and with current production outputs and charging infrastructure being what they are, there are more compelling reasons for collaboration than competition.