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Saudi Arabia Invests $1 Billion In Potential Tesla Rival (cnn.com)
Saudi Arabia is investing more than $1 billion in Lucid Motors, an electric car startup that may give Tesla a run for their money. CNN reports: Lucid is planning a new high-performance electric car. It said the investment from Saudi Arabia's sovereign wealth fund announced Monday will allow it to finish engineering on its first car, the Lucid Air, as well as build a factory in Casa Grande, Arizona, and begin to sell the car by 2020. Saudi Arabia is already a big investor in Tesla. Last month Tesla CEO Elon Musk disclosed that the Saudis had taken nearly a 5% stake in his electric car company.
Musk said that the Saudis had been urging him for almost two years to take Tesla private, offering to provide funds necessary to do so. (Musk announced the plan to go private in August but quickly dropped the idea.) Saudi Arabia is investing in electric vehicles to diversify away from its dependence on oil. Lucid's Chief Technology Officer, Peter Rawlinson, was formerly a vice president and chief vehicle engineer at Tesla. He helped design the Model S, the company's breakthrough car. He left Tesla in 2012, shortly after the Model S went into production.
Musk said that the Saudis had been urging him for almost two years to take Tesla private, offering to provide funds necessary to do so. (Musk announced the plan to go private in August but quickly dropped the idea.) Saudi Arabia is investing in electric vehicles to diversify away from its dependence on oil. Lucid's Chief Technology Officer, Peter Rawlinson, was formerly a vice president and chief vehicle engineer at Tesla. He helped design the Model S, the company's breakthrough car. He left Tesla in 2012, shortly after the Model S went into production.
Isn't every car manufacturer, and every would be "entrepreneur" out there building their own electric car?
Yes. Jaguar and Mercedes are both bringing out electric cars, for instance. The Jaguar I-PACE looks to be a better car than the equivalent Tesla.
Emphasis mine
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"oil production is the #1 strategic concern of Saudi Arabia, and electric cars are their anathema."
yes, oil currently is their no #1, but they are pouring money into renewables, they see the future better than Trump
https://www.bloomberg.com/news...
"The hands that help are better far than lips that pray." - Robert Ingersoll (1833-1899)
What's electric cars being the future has to do with TSLA's viability as a company? VAG, BMW, etc have literally tens of billions of money sitting waiting to convert their shit over if it becomes financially a good proposition to do it - they have tens of gigafactories - their ENTIRE EXPERTISE that has enabled them to remain viable car companies is based around production and logistics around it - the Tesla gigafactory seems puny in comparison and indeed it is, it's just called giga for marketing reasons - vag doesn't need to "market" it's factories, so they don't, but there's a reason why they're still alive and not bailed out for the tenth time.
The thing with Tesla is that.. they don't really have any special technology. They just sold it at a price that didn't make any fucking sense for them to be doing, since they were selling all production(supposedly) and still losing money(even after one time book shenigans). The reason Musk is under enermous pressure is that now is the time the company has to start making profit, not another 10 years into the future because electric cars are the future. Basically his promises that his supermodernhyper Gigafactory can churn out production cheaper than VAG etc's factories can need to be kept right now.
Lucid motors also however, a shit grade investment. Their car? a fucking 1000hp sedan. good luck selling that 20 000 - 130 000 units in a year. They're not sitting on any technology unique to them and they don't have decades of expertise in manufacturing.
So yeah, Saudis putting money into it - whatever. Call the market up when they have some special sauce to make 20 000 dollar cars people want to buy.
And of course teslas are nice cars, they cost an arm and a leg and still are sold for too cheap so they better well should be, but the technology really isn't all that special, whats special is putting them into a product and selling it at the price.
Why do american car companies insist on building stuff people can't afford anyways en masse? don't they realize that 80 000 dollar + cars are an extreme luxury, just because they live rich themselves? is it because they can't optimize their production for worth shit? because Musk sure as fuck sold the cheapo model of the 3 but can't deliver.
world was created 5 seconds before this post as it is.
No, Saudi Arabia got a shock when oil dropped from $120 per barrel down to around $30 per barrel in 2014 as it plunged their economy into deficit. This gave them a massive wake up call and created a realisation that they can't depend on oil forever.
They were surprisingly smart, where most countries such as the UK and Russia have squandered their oil wealth with nothing to show for it, other countries like Norway set up a sovereign wealth fund to see them into the future. Saudi Arabia is taking this approach of forward thinking too, and planning for the future whilst it has oil wealth, rather than waiting until the oil wealth runs out then thinking "Right, now what?" when it's ultimately too late.
This decision to plan for the future has been cemented into reality in a number of very visible ways, from using it's massive investment fund to start focussing on future tech that will only grow in value going forward such as renewables and electric cars, by strengthening it's base economy through simple things such as liberalising it's approach to women. A key realisation was that the Saudi economy could literally double in size by allowing the half of it's population that are not currently allowed to work on equal terms to do so. It will be a long process as it requires changing attitudes when there are still very dangerous hard liners in the country but we've already seen some fairly big leaps towards it, such as allowing women to drive, and allowing women to make up over 30% of the ruling council, which interestingly is a better male-female ratio than most Western democracies. When only 50% of your working age population are allowed to work, enabling the other 50% to do so as a way to obtain a quick, easy, future proof, baseline economic boost is really a no brainer.
Furthermore, we've seen things such as purges of the corrupt elite to drive corruption out the economy, which can have severe consequences as we see in Russia - where Russia has masses of natural resource wealth, it gets filtered off into Swiss and Cayman bank accounts of only a handful of individuals to the detriment of the wider and long term health of the country. In fact, the only reason Russia with all it's potential isn't a wealthy modern economy across the vast majority of it's territory and has massive pockets of 3rd world levels of poverty is almost entirely because of corruption - even where economic mismanagement is a problem, such mismanagement usually occurs precisely to aid corruption.
So it's fairly clear that Saudi Arabia is one of a few countries that gets that oil isn't going to be around forever, and that is liberalising it's economy to cater to the realisation of that fact in many ways, from more forward thinking investments, to enfranchising women, to tackling corruption. It's likely Saudi Arabia will always be, or at least for the next few decades a fairly conservative country, but that doesn't appear to be a complete barrier now to modernising their nation as it has been for the last few decades, oil is no longer king, precisely because they saw how badly oil as a dependency can let them down in 2014.
Don't assume countries can't change and that because they were dependent on oil that they'll always be dependent on oil, Saudi Arabia is undergoing a very silent, but very rapid change to make sure that it's secure even if oil prices collapse. They've still got a lot of work to do, but the trajectory should be abundantly clear to anyone paying attention to the changes the country has undergone over the last few years.