Saudi Arabia’s Public Investment Fund (PIF) has raised its stake in Aston Martin, the British luxury car maker. In an effort to boost its automotive sector, the PIF raised its stake in the company from 17.9 percent to 20.5 percent. The fund will award its new shares to the luxury electric vehicle (EV) company, Lucid Group.
Strategic partnership
In June, PIF-backed Lucid and Aston Martin agreed to establish a long-term strategic technology partnership. The partnership involves supporting the British brand’s high-performance electrification strategy and long-term growth.
The $450 million deal will involve the integration and supply of Lucid’s electric vehicle power train and battery systems. Aston Martin will pay Lucid technology access fees through shares and phased cash payments. This makes the US company, Lucid, a shareholder in the British car maker.
The deal is part of Aston Martin’s electrification program, which will include an investment of over $2.45 billion. The investment in this advanced technology will be periodically made over the next five years.
EV industry growth
According to Fortune Business Insights, the global EV industry is projected to reach about $1.6 trillion by 2030. That is a significant increase from the estimated $500 billion in 2023.
With a focus on EVs, the PIF is playing a key role in supporting Saudi Arabia’s ambitions to expand its presence in the mobility sector. Thus, Lucid Group announced its first international manufacturing plant in Saudi Arabia. This plant is expected to produce around 155 thousand EVs a year. Moreover, the company has started the assembly of its first luxury sedan, Lucid Air, at the factory near Jeddah.
Read: Saudi foreign direct investment flows have doubled since 2015
Developing local supply chain capabilities
Last month, the PIF also launched a new company – National Automotive and Mobility Investment Company, or Tasaru Mobility Investments. This announcement aligns with the kingdom’s efforts to boost EV manufacturing. This will allow Saudi Arabia to develop its local supply chain capabilities. Tasaru plans on localizing manufacturing and technology to accelerate the development of the kingdom’s EV and autonomous mobility ecosystem.
The PIF is also collaborating with the Saudi Electricity Company to launch a new EV infrastructure company in October. This company will set up 5,000 fast chargers across the country by 2030. In November 2022, the PIF launched the kingdom’s first EV brand, Ceer. The brand aims to attract more than $150 million in foreign direct investment and create up to 30,000 jobs.
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