Electric car manufacturer Lucid has revealed that it secured an additional $1 billion investment from Saudi Arabia’s Public Investment Fund (PIF), resulting in an 18 percent increase in its shares. The funding will be provided through Ayar Third Investment Co., an affiliate of the Kingdom’s sovereign wealth fund, which is the majority stockholder of Lucid. The investment will be delivered to the California-based company via a newly established series of convertible preferred stock, which has the potential to be converted into approximately 280 million shares. The Saudi government currently holds a 60 percent stake in Lucid and has been investing billions as part of its initiative to diversify the country’s economy beyond oil.
Read more: Lucid unveils state-of-the-art facility for 155,000 EVs in Saudi
Peter Rawlinson, CEO and chief technology officer of Lucid Group, expressed his satisfaction with the continued support from PIF, emphasizing their commitment to establishing Lucid as the leading electric vehicle (EV) technology company worldwide. Rawlinson also highlighted their long-term investments in technology and vertically integrated manufacturing capabilities, with PIF’s support serving as a crucial differentiating factor. Lucid aims to focus on accelerating growth through deliveries, executing key business initiatives with a relentless emphasis on cost, and launching their highly anticipated Gravity SUV later this year.
Manufacturing 9,000 units in 2024
This investment news arrives at a time when the global electric vehicle market is grappling with a slowdown in demand growth and a price war sparked by Tesla. Despite these challenges, Lucid anticipates manufacturing 9,000 units in 2024, surpassing the 8,428 vehicles produced in the previous year. Lucid’s Air luxury sedans directly compete with EVs from Tesla, Mercedes-Benz, BMW, Audi, Porsche, and other prominent brands in the market.
To address concerns about liquidity, Lucid assured investors during its fourth-quarter 2023 financial presentation that it has sufficient funds to sustain operations until at least 2025. The company projects a capital expenditure of $1.5 billion in 2024 as it gears up to launch its Gravity SUV line later this year. By the end of 2023, Lucid had $4.8 billion available, including $4.3 billion in cash.
First manufacturing plant in Saudi Arabia
In September 2023, Lucid established its first manufacturing plant outside the United States in Saudi Arabia. The facility, located in Jeddah, has an initial capacity to produce 5,000 electric vehicles annually. As part of the agreement, the Saudi government committed to purchasing up to 100,000 vehicles from Lucid over a ten-year period. The process involves building the cars in Arizona, disassembling them, shipping them as kits to Saudi Arabia, and then reassembling them at the Jeddah factory. The Saudi workers at the plant reinstall the batteries, reapply the trim and tires, and conduct vehicle testing.
Lucid is not the sole EV player in the Saudi market. In November 2022, Crown Prince Mohammed bin Salman announced the launch of CEER, a government-owned enterprise focused on designing, manufacturing, and selling battery-powered vehicles in Saudi Arabia.
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