Oil giant Saudi Arabia has agreed to invest $1 billion in Lucid, a battery-powered electric vehicle (EV) startup based in Silicon Valley, a move that should vault Lucid into the fray among new EV models headed to the automotive market.
The Kingdom of Saudi Arabia is making the investment through its public investment fund (PIF), a sovereign wealth fund aimed at increasing economic diversification in the kingdom as well turning it into a global financial powerhouse. Saudi Arabia owned a small stake in publicly-owned EV maker Tesla and reportedly was approached to help Elon Musk with an abortive attempt to take the company private.
Lucid said the investment will allow the company to launch its first EV, the Lucid Air, in 2020. The money will be used to complete engineering and testing of the vehicle and to build a factory in Casa Grande, Arizona. Global rollout of the car will begin in North America, the company said.
Lucid Air will be aimed at the luxury market.
Volkswagen AG’s Audi luxury division is unveiling its new eTron electric SUV in San Francisco, the same day as Lucid’s announcement. Audi, BMW and Mercedes-Benz all have announced plans to offer newly-developed EV luxury models that will compete with those built by Tesla. eTron is expected to be equipped with a 95 kilowatt battery and to offer a range of about 250 miles with full charge.
“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”, said Peter Rawlinson, Chief Technology Officer.
Rawlinson, a British engineer, served as chief engineer for the Tesla Model S luxury car. He joined Tesla in 2009 and left three years later.
“By investing in the rapidly expanding electric vehicle market,” said a spokesperson for the Saudi investment fund, “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.