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Lucid Group Announces Agreement With Government of Saudi Arabia to Purchase 100,000 of its Vehicles Over the Next Decade

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【Summary】Luxury electric automaker Lucid Group announced an agreement with the Government of Saudi Arabia for the purchase of up to 100,000 vehicles over a ten-year period. The Saudi Government’s initial commitment is to purchase 50,000 vehicles, with an option to purchase an additional 50,000 vehicles over the same period.

Eric Walz    Jun 03, 2022 7:00 AM PT
Lucid Group Announces Agreement With Government of Saudi Arabia to Purchase 100,000 of its Vehicles Over the Next Decade
The fully-electric Lucid Air sedan.

Luxury electric automaker Lucid Group announced an agreement with the Government of Saudi Arabia  for the purchase of up to 100,000 vehicles over a ten-year period. The Saudi Government's  initial commitment is to purchase 50,000 vehicles, with an option to purchase an additional 50,000 vehicles over the same period.

The order quantity is expected to range from 1,000 to 2,000 vehicles annually and increase to between 4,000 and 7,000 vehicles annually starting in 2025. Delivery of the vehicles is required to begin no later than the second quarter of 2023.

The vehicles purchased by the Saudi Arabian Government will include the Lucid Air sedan and other future models built and assembled at Lucid's existing Arizona factory and its future manufacturing facility that will be built in Saudi Arabia. 

Lucid says its one of the largest commitments of its kind for zero emissions vehicles.

The purchase price of the vehicles will be determined based on the lower of the standard retail price for the applicable vehicle in Saudi Arabia and the standard retail price for the applicable vehicle in the United States, plus the logistics, import costs and other costs of delivering vehicles to Saudi Arabia.

"Delivering up to 100,000 Lucid electric vehicles in Saudi Arabia represents another pivotal moment in our acceleration of sustainable transportation worldwide," said Peter Rawlinson, Lucid's CEO and CTO. "We are delighted to be supporting Saudi Arabia in achieving its sustainability goals and net zero ambitions, as outlined by Saudi Vision 2030 and the Saudi Green Initiative, by bringing our advanced luxury EVs to Saudi Arabia."

Lucid is backed by the Saudi Arabia Public Investment Fund (PIF), so the large order is not surprising.

In Sept 2018, the PIF agreed to invest over $1 billion in California-based Lucid Group and obtain a majority ownership.

The Saudi Arabian Public Investment Fund (PIF) was established in 1971 to provide financing support for projects of strategic significance to the national economy. The PIF invests in the fields of telecoms, aerospace and green technologies, such as electric cars, with a focus on renewable energy and information technology.

This major commitment to purchase tens of thousands of Lucid's electric vehicles will help support the Saudi Government's drive to diversify the economy, provide thousands of highly skilled job opportunities and economic benefit.

The PIF fund was also an early investor in ride-hailing giant Uber. In June 2016, the fund acquired an approximate 5% stake in Uber with an investment of $3.5 billion, the largest ever single investment in the App-based ride sharing company.

The PIF fund was also linked to Tesla and its Chief Executive Elon Musk in 2018. 

On August 7, 2018, Musk tweeted that he was considering taking Tesla private at $420 per share,  adding that "funding was secured". At the time, Musk believed that Saudi Arabia's PIF would provide the necessary funding.

Then on Aug 13, 2018, Musk wrote in a Tesla blog post that the Saudi Arabian sovereign wealth fund had approached him multiple times about taking Tesla private. Musk said the fund first approached him at the beginning of 2017 to express interest in his electric car company because of the important need for Saudi Arabia to diversify away from oil.

Musk added that the PIF held several additional meetings with him over the next year to try to move forward with a going private transaction. After the Saudi fund bought almost 5 percent of Tesla stock through the public markets, they reached out to ask for another meeting. That meeting reportedly took place on July 31, 2018.

However the deal with Tesla never panned out and the funds went to Lucid Motors in Sept 2018.

Lucid completed the previously announced merger with special purpose acquisition company (SPAC) Churchill Capital Corp IV and launched its IPO on July 23, 2021. The combined company now operates as Lucid Group, Inc.

Last week, Lucid Group announced today that the first deliveries of the Lucid Air Grand Touring models have begun. To coincide with launch, Lucid announced a brand new version of its Air sedan called Lucid Air Grand Touring Performance.

The Lucid Air Grand Touring Performance is the most powerful electric vehicle on sale today, but will only be available in North America. Customer deliveries in the U.S. are slated to begin in June 2022 and by August 2022 in Canada. 

The dual-motor Lucid Air Grand Touring Performance delivers 1,050 horsepower with an EPA-estimated driving range of 446 miles. The dual-motors on the front and rear axles can propel the Air Grand Touring Performance from 0 to 60 miles per hour in just 2.6 seconds. 

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