Saudi Arabia is in early talks with Tesla about a potential manufacturing facility, aligning with the kingdom’s diversification efforts away from oil and focus on securing EV metals.
The Kingdom’s discussions with the American electric automaker about the potential establishment of a manufacturing facility within the kingdom, according to sources cited by the Wall Street Journal, following developments surrounding the Turkish President Tayyip Erdogan’s recent request for Tesla CEO Elon Musk to consider building a vehicle factory in Turkey.
Saudi Arabia has been enticing Tesla with the prospect of acquiring specific quantities of metals and minerals necessary for electric vehicle production from various countries, including the Democratic Republic of Congo.
This move aligns with Saudi Arabia’s broader strategy to diversify its economy away from oil dependency. In the light of the recent announcement, it is worth mentioning that KSA’s sovereign wealth fund holds a majority stake in Lucid Group, an electric vehicle startup aiming to challenge Tesla’s industry dominance.
One proposal under consideration by the Kingdom involves providing financial support to commodities trader Trafigura for a struggling cobalt and copper project in Congo.
If successful, this venture could potentially supply a Tesla factory with essential resources. Trafigura is currently reviewing its options for the Congo-based Mutoshi project due to rising costs and persistent low cobalt prices.
Neither Tesla nor Saudi Arabia’s sovereign wealth fund, the Public Investment Fund, have responded to requests for comments at this time.
Earlier in May, Elon Musk had previously stated that the EV giant would most likely select a new factory location by the end of 2023. Currently operating six factories and building a seventh in Mexico, Tesla has set an ambitious goal to achieve annual vehicle sales of 20 million by 2030, a substantial increase from the approximately 1.3 million vehicles sold in 2022.
Inside Telecom provides you with an extensive list of content covering all aspects of the Tech industry. Keep an eye on our News section to stay informed and updated with our daily articles.