The battle to be crowned as the leading electric car company has become more interesting as Tesla's closest rival, Lucid Motors, was recently reported to have received a massive $1 billion investment from the Saudi Wealth Fund. This recent investment drive from Saudi Arabia's sovereign wealth fund came in just months after it formally bought the stake from the other leading electric car company, Tesla.
The recent deal between the Saudi Wealth Fund and Lucid Motors will play a crucial role as the latter is expected to start manufacturing its first electric car model in 2020. The Lucid Motors Air sedan will be the company's first ever electric car model.
Lucid Motors, a startup based in Silicon Valley, is reportedly years behind its supposed schedule of building a plant based in Arizona. The said plant will jumpstart the company's production of its own line of the electric car which will have a price tag of $60,000 once it hits the market.
Widely regarded as the world's biggest oil exporter, Saudi Arabia has been busy diversifying the kingdom's economy following the massive drop in crude prices. As such, the kingdom plans to convert its own Public Investment Fund into one of the world's biggest sovereign fund. Should this all goes to plan, the Saudi Wealth Fund will control more than $2 trillion by 2030. This plan was also put in place in order to somehow mitigate the devastating effect of fluctuating oil prices.
Despite the massive investment to Lucid Motors, many observers have noted that the Public Investment Fund is only interested in taking a minor stake. This is to make sure that the fund's exposure is limited to a single deal. Also, this strategy was adopted in order to save resources for other outlets of investments.
Saudi Arabia's Public Investment Fund has a stake of less than 5 percent in Tesla.
Lucid Motors was initially speculated as the electric car division of another tech giant, Apple. However, as details of the company have started to reach the public, it was revealed that the company was co-founded by Sam Weng and two other partners.
Prior to his founding of Lucid Motors, Mr. Weng was a software engineer at Oracle. The two other partners are makers of battery systems. Since its inception, Lucid Motors was able to poach and assemble a formidable pool of talents which include former employees from Mazda Motors. The company was even able to lure former Chief Technical Officer Peter Rawlinson out of Tesla.
