Electric Vehicles in the Kingdom of Saudi Arabia

Electric vehicles in the Kingdom of Saudi Arabia: The Kingdom began investing in this type of vehicle in 2018 when the Public Investment Fund purchased a share in Lucid Motors, which specializes in the manufacturing of electric vehicles (EVs), and had initially announced building an advanced factory in Saudi Arabia.

The electric vehicle industry is relatively new. It relies on electric power to run its engines instead of traditional internal combustion ones. These vehicles are powered by recharging their electricity storage batteries. The electric vehicle industry is spreading given the global trend towards clean energy. Through the Public Investment Fund, the Kingdom invests in renewable energy, establishing and developing recycling companies and energy efficiency services.

The Kingdom’s interest in the electric vehicle industry aligns with Saudi Vision 2030, which seeks to achieve its objectives of improving the quality of life and promoting green economy by reducing environmental pollution and achieving zero carbon by 2060. Moreover, these objectives include supporting the economic transformation in the Kingdom by investing in promising sectors to diversify economic returns by developing the electric vehicle manufacturing sector, providing opportunities and facilities to attract foreign investments, and strengthening the Kingdom’s position as an investment destination.

Through the Public Investment Fund (PIF), the Kingdom began its journey in EV investment in 2018. PIF had signed an agreement with Lucid Motors, an expert in EV manufacturing, to purchase around sixty-seven percent of the company's shares at around one billion dollars. The agreement also included the establishment of a local company for EV manufacturing within King Abdullah Economic City, north of Jeddah.

In 2022, the Ministry of Finance announced that Lucid Motors began building an advanced factory in the Kingdom with a production capacity of 155,000 cars per year and investments of over SAR12.3 billion in the Industrial Valley of King Abdullah Economic City. The company will start producing four types of electric vehicles starting 2023. The factory will reach its full capacity in 2028. Two exclusive types will be available for its factory in the Kingdom with an export of about 95 percent of its production. This will support the Kingdom's economy and supply chains, and will create investment opportunities.

On September 27, 2023, Lucid Motors launched the "AMP-2" facility for producing electric vehicles in King Abdullah Economic City. In its initial phase, the facility aims to assemble five thousand "Lucid" cars annually. "AMP-2" represents Lucid's second factory in the Kingdom. The facility's initial operations involve reassembling components of Lucid Air cars previously manufactured at the company's manufacturing facility "AMP-1" in Casa Grande, Arizona, USA.

In order to enhance the Kingdom's efforts in manufacturing this type of vehicle, the Kingdom launched the first Saudi brand for its electric car industry, represented by Ceer, which designs, manufactures and sells EVs equipped with advanced technological systems, such as the autonomous driving feature in the Kingdom and GCC countries. These EVs include Sedan cars and SUVs. These cars are set to be available by 2025.

Ceer's launch will empower the vehicle sector, which provides development opportunities and diversifies sources of income for the Saudi economy. The company is expected to attract direct foreign investments of up to SAR562 million to support the economy, and will create direct and indirect thirty thousand job opportunities. The company's contribution to the GDP of the Kingdom's economy is expected to reach SAR30 billion by 2034.

The Saudi Standards, Metrology and Quality Organization adopted the Technical Regulations for Electric Vehicles in January 2018. The first stage of implementation stated that only individuals are allowed to import after ensuring that requirements are complied with. In 2020, the organization organized a virtual workshop titled The infrastructure of electric vehicles in the Kingdom, in cooperation with the Ministry of Energy, the Ministry of Municipal, Rural Affairs and Housing, the Electricity and Cogeneration Regulatory Authority and the Saudi Electricity Company. Through the workshop, it announced that the commercial import of EVs with their chargers has been approved to support investment in this sector, thus allowing access to agents and initiating the selling process, in accordance with the procedures set by the stakeholders.

In order to prepare the infrastructure for EV charging stations, a special committee was formed to study the various aspects of receiving this type of vehicle under the name Infrastructure Committee for Electric Vehicle Charging Stations headed by the Ministry of Energy. The committee's members include public and private entities, as well as research centers. In 2020, the Ministry of Municipal, Rural Affairs and Housing issued a regulation related to the technical requirements for charging EVs to prepare for the expanded use of this type of vehicle in the Kingdom.

Driving EVs has reached an advanced stage through AI technologies, as the vehicle can now drive in autonomous mode. In order to benefit from modern technologies in the field of technology, innovation and science, the Saudi Data and Artificial Intelligence Authority (SDAIA) worked with the Ministry of Transport and Logistic Services to improve the infrastructure of this type of vehicle, enhance safety in its components, and raise transportation efficiency. If the technology behind autonomous vehicles evolved, their production increased and their policies were adopted, they are expected to become safe and reliable by 2025, and commercially available worldwide in 2030. At this rate, autonomous vehicles will make up half of the new sales after 2045, and will become accessible to all by 2050.