Tesla launches in Saudi Arabia despite country’s past feud with Musk

• Tesla has begun selling vehicles in Saudi Arabia, signaling its entry into a market with limited EV infrastructure, comparatively low sales, and a history of tensions with CEO Elon Musk. However, the move comes as the country attempts to expand its electric vehicle sector, with $39 billion in planned investments.
• In 2023, only about 2,000 EVs were sold in Saudi Arabia, less than half of what Tesla sold daily last year. The country currently has 101 public charging stations—mostly in major cities—leaving long-distance travel largely unsupported.
• Tesla’s expansion follows a prior dispute between Musk and Saudi Arabia’s Public Investment Fund over a failed 2018 deal to take the company private.

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Tesla has officially begun selling its vehicles in Saudi Arabia, a country that once feuded with its CEO Elon Musk. The automaker is also entering a market that is still in the early stages of electric vehicle (EV) adoption and infrastructure development.

What is the current status of Saudi Arabia’s EV sector?

In 2023, approximately 2,000 EVs were sold across Saudi Arabia, less than half of the 4,983 cars Tesla sold on an average day globally during the same year.

Meanwhile, as of 2024, Saudi Arabia has 101 EV charging stations nationwide, most of which are concentrated in major cities, making long journeys across desert roads unfeasible. For example, there are currently no EV chargers along a 559-mile stretch of highway connecting the capital of Riyadh to the holy city of Mecca.

What caused a prior conflict between Musk and Saudi Arabia?

Tesla’s entry into the Saudi market follows years of strained relations between Musk and the country’s Public Investment Fund (PIF). In 2018, Musk stated on social media that he had “secured funding” from the PIF to take Tesla private.

However, he later alleged that the fund withdrew its support, while Saudi officials maintained they had expressed interest but made no firm commitment. The situation led to tense discussions between Musk and Saudi representatives and a securities fraud lawsuit brought by Tesla investors against the company and CEO.

Why is Tesla planning to expand in the Saudi market?

Despite these potential challenges, Tesla is moving forward with expansion efforts in the country. Musk’s relationship with the Saudi government has improved since he took on a high-profile role in the administration of President Donald Trump, who is expected to visit Saudi Arabia in the coming weeks.

Saudi Arabia has also announced significant plans to support EV adoption. The government is investing an estimated $39 billion in the sector, including a target of 30% of all vehicles in Riyadh being electric by 2030. The country also plans to expand its public charging infrastructure to 5,000 stations by the end of the decade through a newly established national company.

What happens next?

Other electric vehicle manufacturers have seen promise in Saudi Arabia’s plans to bolster its EV industry. Chinese automaker BYD, one of Tesla’s main global competitors, has already opened a showroom in the country.