Lucid Motors (NASDAQ: LCID), the prominent electric vehicle (EV) startup, secured $3 billion through a recent stock offering last month.
Notably, Saudi Arabia’s Public Investment Fund (PIF) contributed almost two-thirds of this massive investment, sparking a wave of optimism among Lucid’s investors and resulting in a sharp surge in the company’s share price. PIF is also Lucid’s largest shareholder.
Now, the automaker’s shares have risen once again on strong links to the largest Middle Eastern nation. To be more specific, Lucid struck a deal to start offering its luxurious electric cars for lease for the first time in Saudi Arabia in a clean energy push aimed at preserving the country’s environment, the transportation regulator said on July 18.
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Lucid stock price analysis
At the time of writing, shares of Lucid were changing hands at $7.48, up over 6% on the day, suggesting that investors welcomed the Saudi deal.
However, over the past week, LCID remains down around 12%, mainly due to a disappointing delivery and production update for Q2 published last week. According to the report, Lucid shipped 1,404 EVs in the quarter ended June 30, notably below Wall Street estimates of 1,873.
Despite recent challenges stemming from weak delivery figures, Lucid’s prospects remain hopeful as the company pushes forward with its ambitious expansion plans.
The automaker’s foray into Suadi Arabia indicates a strong backing for the company’s initiatives, potentially positioning it for a stock price rebound.
Saudi Arabia intends to reduce reliance on oil through EVs
Saudi Transport General Authority (TGA) announced on Tuesday that local residents and tourists are now able to rent Lucid cars amid surging demand for electrified vehicles in the country.
The regulator initiated the launching event to rent 10 Lucid EVs that will be available at Saudi’s leading car rental firm Theeb Rent-A-Car.
The move represents another effort that is a part of the Kingdom’s Vision 2030 plan, led by Crown Prince Mohammed bin Salman. The program seeks to reduce Saudi Arabia’s carbon footprint, diversify its non-oil economy, and create a more sustainable future.
At the moment, Saudi Arabia’s economy heavily relies on oil, which accounts for almost 50% of its gross domestic product (GDP). To diversify its economic growth drivers, the Kingdom’s strategy includes, among other things, building sophisticated EVs and exporting them while raising the contribution of non-oil exports to non-oil GDP to 50%, compared to the current 16%.
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