Tesla reported to be in talks to set up factory in Saudi Arabia

Saudi Arabia is in early talks with US electric vehicle (EV) maker Tesla to set up a manufacturing facility in the kingdom, the Wall Street Journal (WSJ) reported on Monday, citing sources familiar with the matter.

The report comes just hours after Turkish President Recep Tayyip Erdogan asked Tesla CEO Elon Musk to build a vehicle factory in Turkey, according to the country’s communications directorate. Musk is also set to meet Israeli Prime Minister Benjamin Netanyahu in California on Monday.

Saudi Arabia has been wooing Tesla with the right to purchase certain quantities of metals and minerals the company needs for its EVs from countries such as the Democratic Republic of Congo (DRC), the report said.

The kingdom has been trying to shift its economy away from oil, while its sovereign wealth fund is the majority investor in Lucid Group, one of the EV start-ups looking to challenge Tesla’s dominance of the industry.

One of the proposals the kingdom is considering involves extending financing to commodities trading giant Trafigura for a flailing Congolese cobalt and copper project, which could help provide a potential Tesla factory with supplies, the WSJ report said.

Tesla and Trafigura did not immediately respond to requests for comment, while Saudi Arabia’s sovereign fund, the Public Investment Fund, declined to comment.

Musk said in May that Tesla would probably pick a location for a new factory by the end of 2023. It now has six factories and is building a seventh in Mexico in northern Nuevo Leon state, part of the carmaker’s push to expand its global footprint. It has a goal to sell 20-million vehicles a year by 2030, up from about 1.3-million in 2022.

Reuters