Casa Grande is a step closer to adding 2,000 new auto manufacturing jobs, after Saudi Arabia’s sovereign wealth fund invested more than $1 billion in Lucid Motors, a California-based electric-car startup.
Lucid says it will use the money to complete engineering development and testing of its first electric car, the Lucid Air, to construct its factory in Casa Grande, begin its North American retail rollout and begin production for the car.
Lucid Motors announced in 2016 it would build its factory in Casa Grande, but it was still seeking capital to construct the $700 million plant.
The Saudi fund’s investment in Lucid, announced Monday, comes just weeks after Tesla CEO Elon Musk earlier claimed the kingdom would help his own firm go private.
Tesla stock closed slightly lower Monday in reaction to the news, the same day that the Saudi fund announced it had taken its first loan, an $11 billion borrowing from global banks as it tries to expand its investments. It wasn’t immediately clear if that loan money played a part in the electric-car investment.
The investment is seen as a bold move for Saudi Arabia, an ultraconservative kingdom that for decades has relied on its oil wealth as the world’s top crude exporter. But previous splashy market-moving promises by the kingdom’s assertive Crown Prince Mohammed bin Salman have yet to materialize.
Lucid issued a statement quoting Peter Rawlinson, its chief technology officer, welcoming the investment.
“At Lucid, we will demonstrate the full potential of the electric-connected vehicle in order to push the industry forward,” said Rawlinson, who worked as the lead engineer of the Tesla Model S before joining Lucid.
The $1 billion investment easily dwarfs prior funding for the manufacturer and puts Saudi Arabia clearly in the firm’s driver seat. Three previous venture funding rounds have netted Lucid Motors some $131 million, according to the business information website crunchbase.com.
The firm’s all-electric Lucid Air is to have a range of over 400 miles. The company already is taking deposits for the vehicle, which it has priced at $52,500.
The company wants to make up to 130,000 vehicles per year by 2022.
The Saudi announcement comes after Musk on Aug. 7 tweeted that he had “funding secured” to take Tesla private. Investors pushed Tesla’s shares up 11 percent in a day, boosting its valuation by $6 billion.
There are multiple reports that the U.S. Securities and Exchange Commission is investigating the disclosure, including asking board members what they knew about Musk’s plans. Musk on Aug. 24 said Tesla would remain publicly traded.
On Monday, Tesla stock fell as much as 2 percent before rebounding. The Financial Times previously reported that the Saudi sovereign wealth fund, known by the acronym PIF, had recently secured a near 5 percent stake in Tesla.
