Saudi Arabia is emerging as a global leader in EV market with the launch of its own electric vehicle brand Ceer, and the recent opening in Jeddah of a factory by US luxury EV maker Lucid Group. Saudi Arabia is taking all efforts towards creating an EV manufacturing hub.
In 2022, with the aim to diversify the country’s economy from oil, Saudi Crown Prince Mohammed bin Salman launched Ceer, the kingdom’s own EV brand. With the assistance of the PIF and in collaboration with Taiwanese contractor Foxconn, Ceer aims to develop a range of electric vehicles, including sedans and SUVs, with Foxconn responsible for creating the electric platform. Ceer is expected to manufacture 170,000 cars a year.
It may be recalled that California-based luxury electric vehicle maker Lucid Group recently opened its first international manufacturing plant in Jeddah, Saudi Arabia. Partly owned by Saudi Arabia’s Public Investment Fund, the new plant is ultimately expected to produce 155,000 electric vehicles a year.
Going forward, with Lucid and Ceer, Saudi Arabia is aiming to create an EV manufacturing hub that includes South Korean company Hyundai and various Chinese firms.
According to Faisal Sultan, the Lucid Group’s Vice President and Middle East Managing Director, the new facility has added to the company’s existing factory in Arizona. He further said that it has given the ability to efficiently fulfill the recently signed agreement with the government of Saudi Arabia to purchase up to 100,000 vehicles over a 10-year period, with an initial commitment to purchase 50,000 vehicles and an option to purchase up to an additional 50,000 vehicles over the same period.
“The new plant proves the kingdom’s ability to attract investments and compete,” said Saudi Industry and Mineral Resources Minister Bandar Alkhorayef, during factory inauguration.
Saudi Arabia’s National Industrial Strategy has been working on establishing a flexible, competitive, and sustainable industrial economy led by the private sector, revealed Alkhorayef.
The EV industry is one of 12 strategic industrial sectors covered by the NIS (National Investment Strategy) to ensure the Saudi commitment to non-oil sectors.The is one of the main enablers to achieve the goals of Saudi Vision 2030, a comprehensive package of reforms to the national investment system to bridge the investment gaps and to allow economic growth and diversify its production base. The strategy, in general, aims to increase the quality and volume of investments in the Kingdom by making it a stimulating and sustainable investment destination.
As per Ahmed Samir, sustainability market leader for the Middle East region at Bureau Veritas, Saudi Arabia is way behind in using the potential that it has as a country in terms of its capital power, all the desert and the space with the sunshine, in terms of [getting] the global private sector to actually come to Saudi as well.
However, the experts believe that the country is on track and Saudi Arabia has thought about energy transition and is moving towards generating potential economic opportunities by localizing the manufacturing and development of this industry.
Market research firm Mordor Intelligence said that the Middle Eastern and African EV market was valued at $40.25 million in 2021 and is expected to reach $93.10 million by 2027. In 2021, Saudi Arabia said that it wants 30% of vehicles in Riyadh to be electric by 2030.
As per Goldman Sachs research report, the EV sector is beset by some major crosscurrents, our strategists expect technology innovation to supersede these forces in the coming years.
Moreover, experts believe that Saudi Arabia is set to becoming a global EV leader, aligning with its ambitious carbon reduction and renewable energy goals.
Recently, German commercial EV company Quantron AG also delivered the largest fleet of battery EVs in Saudi Arabia. Quantron has partnerships with energy company Petromin and its subsidiary Electromin.
