Tesla Launches First Showroom in Saudi Arabia Amid Low EV Demand

Tesla has opened its first showroom in Riyadh, Saudi Arabia, amid low EV demand due to cheap fuel prices and limited infrastructure. Although local economist Mohammed Al-Qahtani urges the establishment of a factory, the Saudi EV market is growing, with plans for integrated infrastructure and investments from the Public Investment Fund.

Tesla, owned by billionaire Elon Musk, has launched its first showroom in Riyadh, Saudi Arabia, despite the country’s low demand for electric vehicles (EVs). This opening comes amid a drop in Tesla sales and ongoing controversies surrounding Musk’s involvement with the U.S. government. The move is significant in a nation where hybrid cars are scarce and fuel prices remain incredibly low, at 2.33 riyals ($0.62) per liter.

The Saudi economy is deeply reliant on oil, with large, fuel-consuming vehicles dominating the market. Local economist Mohammed Al-Qahtani expressed support for Tesla’s presence but emphasized the need for a factory rather than just a showroom to enhance local production capabilities. Additionally, inadequate charging infrastructure and the country’s expansive geography pose challenges to EV adoption; a journey from Riyadh to Jeddah spans nearly 950 km (590 miles), exceeding the range of most electric vehicles.

Despite limited growth in the Saudi EV market, it has shown promise, tripling last year to nearly 800 cars, as reported by Al-Iqtisadiyah. The Saudi government is actively working to diversify its economy, aiming to install 5,000 EV chargers by 2030. Furthermore, the Saudi Public Investment Fund owns 60 percent of luxury EV manufacturer Lucid and plans to collaborate with Hyundai to develop a plant for both EVs and conventional petrol cars. The local brand CEER is slated to begin production in 2025, reflecting further investment in EV technology and local production.

Tesla’s entry into Saudi Arabia is pivotal amid a landscape dominated by low fuel prices and a lack of charging facilities. While local support exists for expanding EV infrastructure, substantial challenges remain, including geographical constraints and the need for more production capabilities. Initiatives to enhance the EV market in the kingdom are underway, but future growth hinges on addressing the significant barriers to EV adoption.

Original Source: www.ndtv.com