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US electric car manufacturer Lucid Motors will use the Public Investment Fund's (PIF) over $1 billion in funding to accelerate production as well as launch Lucid Air in 2020, a senior company executive told Argaam in an exclusive interview on Tuesday.
"We closed that deal literally over five weeks ago, and that will allow us to push Lucid Air production, set up our dealer network and launch the vehicle in 2020," Derek Jenkins, vice president - design, Lucid, said on the sideline of the Future Investment Initiative (FII) 2018 in Riyadh.
Last month, the Saudi sovereign fund signed an investment agreement of over $1 billion with Lucid, as part of the PIF's international investment strategy.
While the share of electric vehicles (EV) has been on the rise in North America and China, Jenkins said the trend is expected to catch up in Saudi Arabia and the Middle East over time.
"They [PIF] see it as an important part of the future, not just for this region, but all over the world. They seem to be very committed to that as we alleviate EV to a new level and inspire a new generation of drivers."
Though no discussions have taken place on Lucid's entry into Saudi Arabia so far, Jenkins said that Saudi Arabia and the Middle East region have the right environment to set up EV charging infrastructure.
"There is a big opportunity in Saudi Arabia and the Middle East, given the climate which is particularly suited to EV in setting up of charging infrastructure."
In a recent report, Bank of America Merrill Lynch (BofAML) estimated EVs would rise from 1 percent of car sales in 2017 to 2.5 percent in 2020 and 12 percent in 2025.
Saudi Arabia has already announced a renewable energy program that will see it invest between $30 billion and $50 billion by 2023. The Kingdom plans to add 9.5 gigawatts of renewables to its energy supply by 2023.
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