RIYADH: Saudi Arabia has announced the establishment of its first electric vehicle manufacturing plant in the country, with the government planning to ensure that 30% of all vehicles in the capital, Riyadh, run on electricity by 2030 .
This is another step towards promoting a sustainable lifestyle in the Kingdom which has set ambitious plans for diversification away from the oil economy as part of Vision 2030.
The factory which will have a capacity to produce up to 150,000 electric vehicles each year will be set up by Lucid Group. The American company recently signed an agreement with the Saudi Ministry of Investment and the Saudi Industrial Development Fund, allowing it to set up its first factory outside the United States in Saudi Arabia.
“Our strong relationships with the PIF and our partners at MISA, KAEC and SIDF give us unique insight into the demand for luxury cars and SUVs in Saudi Arabia and beyond. We are excited to introduce the world’s most advanced electric vehicles to more global markets,” said Peter Rawlinson, CEO of Lucid Group.
The Lucid factory is expected to unlock huge funds that the government plans to distribute in the form of grants to promote sustainable projects undertaken by local and foreign companies, including companies supported by the PIF.
“Building a factory in Saudi Arabia can provide access to government grants that should help the company succeed,” said Mohammed Al-Suwayed, CEO of Razeen Capital.
PIF, a major player in Lucid, is developing several giga-projects, many of which revolve around sustainability and eco-friendly practices.
Among these projects are NEOM and the Red Sea project, which aim to limit the use of standard vehicles within their destinations.
“We are looking to find ways to bring, operate and maintain electric vehicles and build electric grids in the destination,” said Najwa Hamzeh, Senior Director of Smart Destinations at TRSDC, in an exclusive interview with Arab News.
She said many steps need to be taken to keep this movement practical and sufficient, including finding enough maintenance facilities and electric vehicle charging points.
“We are also looking to build the first vehicle maintenance facility and the first depot for electric vehicles,” Hamzeh added.
Electric vehicle charging imports were allowed in 2020, according to specified procedures, said Saad Alkasabi, governor of the Saudi Organization for Standards, Metrology and Quality, or SASO.
“The Kingdom has started to study the technical, economic and environmental details related to EVs, its infrastructure, as well as the opportunities it offers to reduce environmental pollution,” he added, according to Argaam. .
The Public Investment Fund originally invested in Lucid Group in 2018, with its controlling stake currently worth $46 billion. The Lucid plant is expected to generate up to $3.4 billion in value for the company over the next 15 years.
The creation of a factory for the Lucid company will help achieve the fund’s objectives, including increasing the proportion of local content to 60% in the fund and its subsidiaries by the end of 2025.
The partnership between the PIF and Lucid Group is expected to provide training opportunities for Saudi youth, who can also enroll in the Lucid Company program which has graduated many specialists.