Over the last two years since unveiling its Lucid Air premium sedan and its plan for a massive EV factory in Arizona, Lucid Motors struggled to secure the funding to get things going.
Today, the startup finally announced that it secured an investment of “over $1 billion” from Saudi Arabia to finally build its electric vehicle factory.
The Public Investment Fund of Saudi Arabia (PIF), which recently took a ~5% stake in Tesla and was reportedly in talks to help take the company private, has come to an investment agreement with Lucid.
A spokesperson for PIF said:
“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.”
The fund, which is worth an estimated $250 billion, says that the investment represents “a strong example” of their commitment to international investments.
The spokesperson added:
“PIF’s international investment strategy aims to strengthen PIF’s performance as an active contributor in the international economy, an investor in the industries of the future and the partner of choice for international investment opportunities. Our investment in Lucid is a strong example of these objectives.”
When Lucid first unveiled its plan for a $700 million factory in Arizona back in 2016, they planned to start producing their first vehicle in 2018.
Last year, they pushed the timeline to 2019.
Now with the new investment from PIF, the company plans for the Lucid Air to be available in 2020:
“The transaction represents a major milestone for Lucid and will provide the company with the necessary funding to commercially launch its first electric vehicle, the Lucid Air, in 2020.”
Specifically, Lucid said that it plans to use the new funds to “complete engineering development and testing of the Lucid Air, construct its factory in Casa Grande, Arizona, begin the global rollout of its retail strategy starting in North America, and enter production for the Lucid Air.”
Peter Rawlinson, Chief Technology Officer of Lucid and the former Tesla Model S Chief Engineer, commented on Lucid’s plan now that they have funding:
“The convergence of new technologies is reshaping the automobile, but the benefits have yet to be truly realized. 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,”
Last year, the company announced an aggressive $60,000 base price for its luxury all-electric sedan with 240 miles of range and several more higher-end configurations.
While it’s hard not to be suspicious of petrol rich-Saudi Arabia investing heavily in electric vehicles, I think they are simply trying to diversify.
It’s also easy to say that it’s just another premium electric vehicle while the industry is currently trying to focus on bringing down pricing to enable more affordable EVs. But Lucid Motors is a startup and like Tesla did before, it wouldn’t be smart to start with a cheaper, higher volume car.
Now things get interesting as they try to bring the vehicle to production. Production within the next two years with a brand new factory is quite an aggressive timeline.
We will follow the development in the coming months and report back.