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The Kingdom is investing heavily in green mobility — with no sign of a slowdown: Sustainable transport has a buzzword in Saudi Arabia over the past couple of years, with the Public Investment Fund (PIF) lining up funds toward decarbonizing the mobility sector through establishment of the inaugural national electric vehicle brand Ceer, and investments in US-headquartered Lucid Motors, and Aston Martin, to name a few.
US interest in EVs may be coming down from its covid-era high, but the PIF is long-EVs.
The masterplan: The Kingdom has set a target to minimize its carbon footprint and source 50% of its electricity from renewable sources, in part to help fuel the growth of its domestic electric vehicle industry. During COP27, Saudi Arabia joined the Accelerating to Zero Coalition, committing to net-zero new car and van sales by 2040. The fund also set a target to produce 500k EVs annually by 2030, up from a target of 150k in 2026. Riyadh wants to have EVs comprise a third of its cars earlier in 2030.
A spending spree: PIF alongside Taiwanese multinational electronics contract manufacturer Hon Hai Precision Industry Company (better known as Foxconn, the assembler of iPhones) et up Ceer in 2022 and expect to complete works at its USD 96 mn, one mn sqm EV complex in King Abdullah Economic City within two years. The company is expected to contribute USD 8 bn to GDP by 2034 and to be a magnet for more than USD 150 mn in foreign direct investment. Ceer’s EVs are expected to hit the market in 2025.
All part of the Kingdom’s diversification strategy: Lucid CEO Peter Rawlinson said last month that the company is “crucial” to Saudi as one of the cornerstones of the Kingdom’s economic diversification program. “We’re in this together for the long run. Nobody wants this more than Saudi Arabia. … This is like a marriage.”
Building big things takes time: Lucid saw its net loss for 2023 come in at USD 2.8 bn, more than double the USD 1.3 bn it lost the year before. Revenues dipped 2% y-o-y to USD 595 mn in 2023. For the fourth quarter, the automaker’s losses came in at USD 654 mn, against USD 473 mn in the comparable period.
An EV-focused investment arm: The PIF, in October 2023, established a new investment company focused on EVs dubbed Tasaru Mobility Investments in a bid to strengthen the local supply chain for electric and autonomous vehicles.
Breaking ground on some milestones: The Saudi National Automobiles Manufacturing Company (SNAM) signed a partnership agreement last year with South Korean automaker KGM Mobility — formerly known as SsangYong Motor — to manufacture KGM’s all-electric Torres EVX SUV here at home. Meanwhile, Lucid inaugurated in September 2023 its first overseas production facility in King Abdullah Economic City with a plan to produce 155k EVs yearly in the Kingdom once it hits full capacity here next year.
Charging stations: The Kingdom established the Electric Vehicle Infrastructure Company (EVIQ) in October 2023 to expand fast-charging infrastructure across the kingdom, and opened its first fast EV charging stations in Riyadh in January 2024. The company aims to set up over 5k fast chargers in over 1k locations in cities across KSA and unrolled the kingdom’s first testing and software center for EVs.
What’s next? PIF is also eyeing a USD 250 mn stake in Chinese electric car manufacturer Human Horizons. The agreement was expected to be hammered out last year, with whispers of PIF’s intention to buy into the Shanghai-based firm at a USD 3 bn valuation.
