Saudi Arabia pumps more cash into Lucid electric vehicle manufacturer

Saudi Arabia decided to make its stand on electric vehicle technology by pumping more cash into Lucid. The country is renowned as a mega oil exporter and hopes that this electric vehicle manufacturer can develop models for its citizens. The Public Investment Fund (PIF), a puppet of the Saudi Crown Prince Mohammed Bin Salman, became Lucid Motors’ chief investor. Other companies that have expressed similar interests include Franklin Templeton, Wellington Management, BlackRock BLK, Winslow Capital Management, Fidelity Management & Research, and Neuberger Berman.

These companies agreed to provide a sum of $2.5 billion to Lucid Motors. The deal will also involve listing the company in the New York Stock Exchange in an acquisition plan by Churchill Capital Corp IV. However, the market wasn’t excited about this movie. The acquisition will generate $2.1 billion that the company can use to run its projects. The deal will be sealed in the second quarter of this year.

The equity firms have not declared that they will contribute in this financial session, although the totals place Lucid Motors at a value close to $24 billion. Three years ago, Saudi Arabia’s PIF revealed that the first investment it will be bringing into the project is $1 billion. The equity firm stated then that it would provide the required funding to unveil Lucid’s first electric vehicle model called Lucid Air, last year.

However, the project slumped through last year, and the company is yet to infiltrate the market with this model. The company explained that stated that it would be mass-producing and distributing the model into the market. The model will be going for $69900. The executives of the company added that they would be manufacturing an SUV called Project Gravity to supplement this model in the market in the next two years.

Lucid Motors is optimistic that it can manufacture 20000 Lucid Air units in 2021, generating a revenue of $2.2 billion. Adding new models to the company’s line of production will ensure that it produces 251000 cars with revenue exceeding $20 billion in the next five years. The company is readying itself to record the first proceeds from this production before taxes, interest, and depreciation factor into the price of the car in the next three years.

The PIF is not only interested in the program for the return on its stake in the company. The equity firm is also trying to create avenues for the company to develop its branches in Saudi Arabia to provide employment for the citizens. The equity firm executives explained that they observed the unemployment rate among the Saudi Arabian graduates, and they want them to develop such projects in the country.

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