PIF-backed Lucid Motors to be made in Saudi as it competes with Tesla on the road to success

PIF-backed Lucid Motors to be made in Saudi as it competes with Tesla on the road to success
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Updated 08 September 2021

PIF-backed Lucid Motors to be made in Saudi as it competes with Tesla on the road to success

PIF-backed Lucid Motors to be made in Saudi as it competes with Tesla on the road to success
  • Saudi Arabia's Public Investment Fund has invested $1 billion into Lucid Motors
  • Yet the firm is struggling to take on rival Tesla

US-based electric car maker Lucid Motors will produce vehicles in Saudi Arabia by 2024, as the battle for dominance in the fledgling sector ramps up in the Middle East.

The announcement of a factory being built in the Kingdom was made on Tuesday, with Saud Al-Askar, deputy governor of the Saudi Standards, Metrology and Quality Organisation, telling Al-Arabiya TV the paperwork on the deal was being finalised.

The move comes after Saudi Arabia's Public Investment Fund poured $1 billion into the company in April 2019 - giving it a 67 per cent stake in the firm.

Yet even with the funding, Lucid will be in a tough position to match the success of high-profile electric vehicle (EV) rival Tesla.

Lucid Motors’ flagship Lucid Air model, priced at over $70,000, is due to launch early next year but has received only 11,000 orders to date.

That’s about half as many Teslas have been sold every month in the US alone this year, and just under 388,000 cars in total were sold in Saudi Arabia in 2020.

Next year, the Lucid has a production target of just 20,000 cars.

Peter Rawlinson, chief executive officer of Lucid Motors, recognises that the firm has some way to go in challenging Tesla, and said: “Tesla is in its pre-ascent position because it recognised that electrification is a technology race."

Lucid hopes to win the EV race on efficiency, with the firm claiming its vehicles will be 40 percent more efficient than any other electric car, travelling 17 percent further for the same size battery pack as the Tesla Model S long range.

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Designed to achieve more range, its battery enables 4.6 miles of travel per kilowatt hour of power, meaning a Lucid car has a range of more than 500 miles on a single charge, compared to about 400 miles for the Tesla Model S.

But despite recent drops in battery prices, electric vehicles still cost more than their internal combustion counterparts. Pre-tax, batteries account for 25 percent to 35 percent of a vehicle's retail price.

Sue Magnusson, director of CMF design at Lucid Motors says that the company also hopes to stand out from its rivals due to its design philosophy.

“The use of sustainably sourced materials is an integral part of Lucid’s design philosophy. At every step, we must ask suppliers where the raw goods come from, how they’re harvested, how the factories are run and how they address the safety of their workers.

“Many manufacturers hold a standard that everything must be about quality and craftsmanship. Although an important part of what we do each day, we must also believe that reaching the highest standards in these areas without considering the impact of the processes and materials we use isn’t nearly enough. 

“Across the entire electric car realm, sustainability should be a mission, not a phase,” she wrote in a column for Arab News in August that talked about the sustainably sourced leather, wood, polyester, and wool used in the Lucid Air’s interior.

Two other more expensive Lucid versions have also been announced, costing over $169,000. The Dream Edition Performance is designed for speed and acceleration, while the Dream Edition Range, is designed to maximise range.

Production was limited to 500 of these cars, which quickly sold out earlier this year.

Manufacturing them here in the Kingdom would be a significant win for the economy, employment, and the Vision 2030.

PIF already has a six-month internship program commencing in January that Saudi graduates can apply for, involving working at Lucid Motors’ US offices in California, Newark, and Arizona.

Although a fleet of Mercedes EQ electric cars are believed to be in use at NEOM, there are currently no electric cars sold in Saudi Arabia - only hybrid models - nor is there any charging infrastructure for them, apart from few locations like the one of the malls in Jeddah, an auto industry source told Arab News. 

No legislation has yet been put in place in relation to the infrastructure, Arab News understands.

There are no battery disposal or recycling facilities in the Kingdom either, the source said.

While that is the case, there will be a long road ahead for electric car ownership here. Something that is expected to change with more Lucids cars on the road in Saudi Arabia and elsewhere.


FII: Bank chiefs, CEOs pass mixed verdict on cryptocurrency investment

CNN's Richard Quest (L) moderates a session at the annual Future Investment Initiative (FII) conference in the Saudi capital Riyadh on October 26, 2021. (AFP)
CNN's Richard Quest (L) moderates a session at the annual Future Investment Initiative (FII) conference in the Saudi capital Riyadh on October 26, 2021. (AFP)
Updated 17 sec ago

FII: Bank chiefs, CEOs pass mixed verdict on cryptocurrency investment

CNN's Richard Quest (L) moderates a session at the annual Future Investment Initiative (FII) conference in the Saudi capital Riyadh on October 26, 2021. (AFP)
  • Saudi central bank chief does not foresee destruction of banking system by digital currencies
  • Leading investors still view gold and dollar as a safer haven for investments than bitcoin

RIYADH: The verdict on cryptocurrency products and funds was mixed as CEOs, central bank chiefs, investors and policymakers exchanged views on the topic on the first day of the Future Investment Forum in the Saudi capital.

The three-day forum, which is themed “Invest in Humanity,” includes talks on artificial intelligence, robotics, education, healthcare and sustainability.

Taking part in a session on Tuesday, Fahad Al-Mubarak, the governor of Saudi Arabia’s central bank, said SAMA should have no involvement with crypto-assets as many of those who deal in them are criminals.

He did not foresee the destruction of the banking system by digital currencies but rather an expansion of centralized systems for regulating tender.

Bitcoin is the leading digital currency trading internationally, followed by Ether and Solana.

The three-day forum, which is themed “Invest in Humanity,” includes talks on artificial intelligence, robotics, education, healthcare and sustainability. (AFP)

Regulators are still playing catch-up when it comes to how cryptocurrencies should be governed, Al-Mubarak said.

Having made his point, he noted that there has been a sharp jump in online banking during the coronavirus disease pandemic. “Before the pandemic, only 35 percent of bank transactions were electronic,” he said. “Now it’s around 55 percent.”

Hussain Abdulla, co-CEO of Qatar-based investment bank QInvest, said cryptocurrency products were not yet Shariah-compliant, and more understanding was needed.

Nevertheless, he warned that the Middle East is lagging way behind the US and Europe when it comes to digitization of the banking industry.

“Winners in the banking industry will be those who take steps today toward digitization rather than later,” Abdulla said.

Several prominent business people who took part in FII sessions on Tuesday said leading investors still view gold and the dollar as a safer haven for investments than bitcoin.

Both Larry Fink, CEO of BlackRock, the world’s largest asset manager, and David Solomon, chairman and CEO of the Goldman Sachs Group, said they preferred investments in US dollar over bitcoin.

Ray Dalio, founder and co-chairman of Bridgewater Associates, opted for gold over bitcoin.

Khaldoon Khalifa Al-Mubarak, CEO and managing director of the UAE’s Mubadala Investment Co., said he would take bitcoin “hedged in gold.”

In the past week, the crypto industry has seen inflows to the tune of $1.5 billion, amid soaring optimism with the trading of bitcoin exchange traded funds.

Inflows so far this year hit $8 billion, far exceeding the record set for the whole of 2020 of $6.7 billion, according to data from a report released by digital asset manager CoinShares on Monday.

The bulk of inflows for the sixth straight week went to bitcoin, with $1.45 billion, data showed. Inflows year-to-date amounted to $6.1 billion.

With more than 250 expert speakers from the economic, business, education and corporate worlds, discussions at the FII, dubbed the “Davos in the Desert,” have centered on investments that aim to create the greatest benefits for humanity.

Solomon said there must be clarity regarding indicators of economic recovery and action plans, and this contributes to attracting investments and facilitating the movement of funds.

Guests attending the opening ceremony of the annual Future Investment Initiative (FII) conference in the Saudi capital Riyadh. (AFP)

More broadly, he underscored the importance of supporting and investing in small businesses to ultimately bring growth and innovation to economies.

“One of the key solutions to drive economic participation and growth is support for small businesses and finding ways that we all can contribution to growth and innovation,” Solomon said.

BlackRock’s Fink said: “It is important to improve human and environmental conditions and to think about long-term solutions, and governments have a great burden.”

In his remarks, Al-Mubarak highlighted the importance of coming together to combat the challenge of climate change.

“The climate challenge will require everybody to contribute in their own way. Nobody is going to solve it on their own. We have to solve it together, working together globally as institutions, as governments, as civil society.”


NEOM's tech arm, OneWeb sign a $200m joint venture for high-speed satellite

NEOM's tech arm, OneWeb sign a $200m joint venture for high-speed satellite
Updated 25 min 25 sec ago

NEOM's tech arm, OneWeb sign a $200m joint venture for high-speed satellite

NEOM's tech arm, OneWeb sign a $200m joint venture for high-speed satellite

Riyadh: NEOM Tech & Digital Holding Company – the first holding company to be established as a subsidiary of NEOM – and OneWeb, the global communications network powered from space, have signed a $200 million (SR750 million) joint venture agreement to bring high-speed satellite connectivity to NEOM, Saudi Arabia and the wider Middle East and neighboring East African countries.

NEOM Tech & Digital Hold Co. and the new JV entity will have exclusive rights to distribute OneWeb services in its target regions for seven years from the initiation of the LEO satellite network, which is expected to commence in 2023.

The partnership will see the deployment of OneWeb’s Low Earth Orbit (LEO) satellite constellation, which will not only provide the rapid and reliable connectivity to enable NEOM’s ecosystem of cognitive technologies, but also transform businesses and rural communities in the region where access to fiber-like internet was previously unimaginable, according to a statement.

The agreement also includes a long-term strategic partnership regarding research and development of future connectivity systems.

NEOM Tech & Digital Hold Co. and OneWeb, the second largest LEO operator with 358 satellites and the only licensed operator in Saudi Arabia, expect to complete ground infrastructure in 2022.

 


Saudi Aramco signs new initial deals during the FII

Saudi Aramco signs new initial deals during the FII
Updated 26 October 2021

Saudi Aramco signs new initial deals during the FII

Saudi Aramco signs new initial deals during the FII

RIYADH: Saudi Aramco signed five initial deals as it plans to expand its focus on emerging sectors to drive private sector innovation and investment, it said in a statement during the Future Investment Initiative.

"The Company is pursuing investment opportunities in projects that could potentially reduce Greenhouse Gas (GHG) emissions, following the recent announcement of its ambition to achieve net-zero Scope 1 and Scope 2 GHG emissions across its wholly-owned operated assets by 2050," it said.

The deals are expected to complement Aramco’s continued investments in oil and gas, with further announcements on its Jafurah gas program expected in the near future, it added.  

Amin Nasser, Aramco President and CEO, said: “Our plans illustrate our focus on developing innovative projects and investments, which support our long-term business strategy and aim to have a positive impact. Collaboration will be crucial in promoting economic development and creating new opportunities, as we expand our portfolio, diversify our business, advance low-carbon energy technologies and develop sustainable solutions.”

To move its program forward, Aramco has signed five Memoranda of Understanding (MoUs) with the following companies:

  • Modern Industrial Investment Holding Group and Intercontinental Energy – an MoU to develop a green hydrogen and ammonia project in Saudi Arabia;
  • South Pole Carbon Asset Management Ltd. and Yousef Abdulrahman AlDhabyan Agricultural Est.
  • (YADGREEN) – two separate MoUs to evaluate the feasibility of establishing a National Green Services Company to develop and innovate nature-based solutions (NBS) that help reduce greenhouse gas emissions;
  • BFG – an MoU focused on localizing the manufacturing of advanced nonmetallic building materials, as well as collaboration in research and development;
  • ABB – an MoU to explore localization of digital technologies for oil and gas applications, including domestic capacity building in the Process Automation System (PAS) and instrumentation fields.

Greece wants to work with Saudi Arabia to deliver energy to Europe: Greek PM

Greece wants to work with Saudi Arabia to deliver energy to Europe: Greek PM
Updated 26 October 2021

Greece wants to work with Saudi Arabia to deliver energy to Europe: Greek PM

Greece wants to work with Saudi Arabia to deliver energy to Europe: Greek PM

Greece is keen to work with Saudi Arabia to help deliver energy harvested by the Middle East country to Europe, the Greek Prime Minister has said

Speaking at the Future Investment Initiative Forum in Riyadh, Kyriakos Mitsotakis said the current energy situation in his continent has made him look towards the Gulf for more supply options.

Mitsotakis said Greece is “forming a very strategic partnership with Saudi Arabia”, as he talked up areas of mutual interest, such as hospitality.

However, it was energy provision that was top of his mind, with Misotakis confirming Greece would be shutting down all its coal plants by 2028 at the latest.

He said: “We've signed an agreement with Egypt, but l'm sure there's also going to be a lot of interest in terms of extending these types of agreements. 

“Also, with Saudi Arabia, if this area has the capacity to produce very cheap electricity from renewables, and I'm probably referring to the sun, wouldn't it be of mutual interest to bring this electricity into the European market?”

He went on to claim natural gas could be supplied to Europe via a pipeline that goes through Cyprus, Egypt and Israel.

Mitsotakis argued that Greece and Saudi Arabia “live in the same broad neighborhood” and “share the same challenges”.

After his appearance on the forum's stage, he left with Saudi Arabia's Crown Prince Mohammed bin Salman.

 


US consumer confidence recovers; UK pay rises: Economic wrap

US consumer confidence recovers; UK pay rises: Economic wrap
Updated 26 October 2021

US consumer confidence recovers; UK pay rises: Economic wrap

US consumer confidence recovers; UK pay rises: Economic wrap

RIYADH: Consumer confidence in the U.S increased to 113.8 in October, up from 109.8 in September, the US-based Conference Board said. Concerns about high inflation were offset by an optimistic outlook for the labor market. 

This suggests that economic growth might have recovered early in the fourth quarter. This comes after consumer confidence in the country declined for three months in a row. 

UK annual pay rises

Full-time earnings in Britain rose by 4.3 percent in April compared to the previous year, data published by the Office for National Statistics revealed.

Median full-time earnings increased to £611 ($843) in April. After adjusting for inflation, the increase was 1.7 percent.

Hong Kong’s trade deficit

Hong Kong's trade deficit expanded to HKD42.4 billion ($5.5 billion) in September up from HKD12.7 billion ($1.6 billion) a year earlier, Hong Kong’s Census and Statistics Department said. 

Imports grew by 23.5 percent to reach an all-time high of HKD484.2 billion ($62.3 billion), triggered by a significant increase in imports of electrical machinery and related parts.

Exports rose at a lower annual rate of 16.5 percent as it reached HKD441.8 billion ($56.8 billion). This was driven by jumps in the exports of electrical machinery, office machines and automatic data processing machines, and gold and silver products.

Brazil’s inflation

Monthly inflation in Brazil reached 1.2 percent in early October, Bloomberg reported, citing the country’s statistics agency. This will likely put some pressure on its central bank to raise interest rates there, despite plans for greater public spending in the country.

The hike in prices was driven by jumps in transport and housing costs, which increased by 2.06 percent and 1.87 percent respectively.

In addition, the country’s annual inflation rate rose to 10.34 percent.