California-based EV startup Lucid Motors (LCID) simply gained its working license to start EV manufacturing in one in all Saudi Arabia’s particular financial zones.

Saudi Arabia launched 4 new Particular Financial Zones (SEZs) in April, designed to make the most of development in key sectors like electrical automobiles, manufacturing, cloud computing, medical tech, and extra.

The financial zones are unfold strategically all through the Kingdom, providing international traders the chance to speculate with particular incentives.

A few of the incentives might embrace decrease company tax charges, tax-free imports of equipment and uncooked supplies, 100% international possession, simple set-up, and labor flexibility.

The King Abdullah Financial Metropolis (KAEC), the place Lucid obtained its allow to start EV manufacturing, is situated on the Pink Sea. With 13% of world commerce passing via the Pink Sea, it gives a strong location to ascertain a worldwide provide chain community.

Particular financial incentives in KAEC embrace 5% company revenue tax for as much as 20 years, 0% customs duties deferral for items contained in the SEZ, 0% value-added tax on items traded throughout the zone and different SEZs, and extra.

Lucid to start EV manufacturing in Saudi Arabia

Lucid is taken into account an anchor investor within the financial zone, with plans to supply 150,000 EVs yearly in Saudi’s financial megacity.

Building on the ability started final Could the place Lucid plans to re-assemble Air electrical sedan fashions pre-built at its Casa Grande, Arizona facility. Mass manufacturing is predicted to start by subsequent 12 months.

The allow approval comes as Saudi seems to be to diversify its financial system with peak oil approaching. A part of the Kingdom’s “Saudi Imaginative and prescient 2030” consists of elevating the share of non-oil GDP from 16% to 50% by the top of the last decade.

Final 12 months, Saudi’s non-oil income accounted for $110 billion, in comparison with $44 billion in 2015. Non-oil GDP grew 5.4% final 12 months.

Saudi’s Public Funding Fund (PIF) invested an further $1.8 billion into Lucid in June. On the finish of June, Saudi’s PIF owned round 60.5% of Lucid’s widespread inventory. The funding fund has injected roughly $9 billion in funds into the EV maker to this point.

Electrek’s Take

In the meantime, Lucid has struggled within the US. Of the 26 EV manufacturers within the US, Lucid positioned 18th with 0.6% of the share.

Lucid had 348 Air EV registrations in July, bringing the full to three,789 via the primary seven months of the 12 months. The posh EV maker lower costs by as much as $12,400 final month to spice up demand.

Maybe a worldwide port in Saudi will assist gas abroad gross sales with particular incentives to assist Lucid get its community up and operating.