Saudi Arabia Accelerates Towards the Summit in Electric Car Industry by 2030

The Kingdom of Saudi Arabia is undergoing a monumental phase of transformation and electrification. The country is embracing ambitious strategies to achieve economic diversification and enhance sustainability. One of the main pillars of this ambitious vision is the shift towards the electric car industry, embodying the kingdom’s vision to make sustainable progress in environmentally friendly transportation.

As part of this transformation, the kingdom has invested at least $10 billion in Lucid Motors, a company based in the United States. Additionally, Saudi Arabia has established “Ceer” as its Saudi brand for the electric car industry. The kingdom has built a dedicated Electric Vehicles Manufacturing (EVM) factory to produce components and parts for electric vehicles (EVs).

Ambitious Plans for a Brighter and More Sustainable Future

Saudi Arabia aims to produce 500,000 electric cars annually by 2030. The kingdom indicates that this will be achieved through its tremendous and ongoing efforts to achieve sustainable transformation and promote advancements in electric car manufacturing.

These efforts include the Public Investment Fund’s investment of $5.4 billion in Lucid Motors and the purchase of up to 100,000 Lucid electric cars over the next ten years. Saudi Arabia has also constructed a factory to assemble cars initially manufactured in Arizona for the Ceer brand.

The Lucid factory is the only one of its kind in Saudi Arabia, and since its opening in September 2023, the kingdom has assembled and developed 800 electric cars.

As for the new company Ceer, established in collaboration between the Public Investment Fund and the Taiwanese technology manufacturer Foxconn, the company is expected to launch its first model next year. However, the company has not yet built its factory in the kingdom.

Key Challenges Facing the Electric Car Sector in the Kingdom

Despite all the efforts, the electric car sector in Saudi Arabia is expected to face challenges related to infrastructure, capabilities, and raw materials. The current production figure of 800 cars does not align with the kingdom’s ambitious vision to become a center for electric car production by 2030.

According to Reuters, the main challenges facing the electric car sector in the kingdom include the lack of local manufacturers to boost production numbers, along with the high cost of labor and a shortage of local suppliers.

In addition, there are no reserves for raw production materials, especially key elements like lithium used in the production of electric car batteries, despite the kingdom’s earlier announcement of its plan to produce these minerals.

In this context, Tatiana Hristova, an expert at S&P Global Mobility, stated, “Ceer plans to source car parts and components from BMW, including the battery—the most costly part of an electric car.”

Contrary to this, Andy Palmer, former CEO of Aston Martin and Chief Operations Officer at Nissan, affirmed the kingdom’s ability to overcome all challenges in this sector, stating, “The Public Investment Fund has enormous capabilities to face all challenges thanks to the energy resources the kingdom possesses.”

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