The kingdom has been wooing Tesla with the right to purchase specific quantities of metals the company needs for its electric cars from countries like the Democratic Republic of Congo, the Wall Street Journal reported on Monday. The Saudi Public Investment Fund (PIF) has already invested significantly in a rival electric car maker, Lucid Motors, which will start limited vehicle reassembly operations later this year at a facility in the southern city of Buzil.
A successful deal would help the U.S.-based carmaker achieve its ambitious goal of selling 20 million EVs by 2030, up from 1.3 million in 2022. It also could aid Saudi Arabia’s efforts to attract substantial foreign investment, a priority for de facto ruler Crown Prince Mohammed bin Salman.
The Saudis have taken on several infrastructure and technology projects to bolster their diversified economy. They include building a $500 billion megacity called Neom, developing a high-speed rail network, and launching an online marketplace for local goods.
But the kingdom has also sought to secure vital resources to transition from oil dependence. It has negotiated with Congo to buy vast troves of mineral assets, including cobalt, used to manufacture EV batteries. The Public Investment Fund, among the most significant shareholders in Tesla and a key player in its failed attempt to retake the company private, is the majority investor in a cobalt mining project in the DRC, Reuters previously reported.
Saudi officials told the Journal that the company is entertaining the idea of setting up a plant in the kingdom. Still, it could reject the proposal if it feels a plant elsewhere will be more lucrative. The officials said the discussions with Tesla began this summer and are at a preliminary stage.
Tesla did not immediately respond to a request for comment, while PIF declined to comment. The US EV maker has six factories and is building a seventh in Mexico. Musk said the company will likely pick a location for its following factory by year’s end.
According to the country’s communications directorate, the Saudi move comes just hours after Turkish President Tayyip Erdogan asked Tesla CEO Elon Musk to build a vehicle factory in Turkey. A statement from the office of Erdogan’s prime minister described the request as “very welcome” and said the government would work with Musk to ensure the factory’s success.
