Lucid to Produce 150,000 EVs Per Year in Saudi Arabia

An electric vehicle on charger (Getty Images)
An electric vehicle on charger (Getty Images)
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Lucid to Produce 150,000 EVs Per Year in Saudi Arabia

An electric vehicle on charger (Getty Images)
An electric vehicle on charger (Getty Images)

Lucid Group signed an agreement with the Saudi Ministry of Investment, the Industrial Development Fund, and the Economic City at King Abdullah Economic City to construct a plant in the Kingdom that will produce 150,000 electric vehicles (EVs) per year.

The Public Investment Fund holds a significant stake of 62 percent of Lucid, in a step that reflects a strategy to select future investment opportunities that provide growth in returns.

The agreement lays the groundwork for a complete production factory in Saudi Arabia and is expected to accelerate the Kingdom's strategic goal to transform and diversify its economy through sustainable energy and transportation.

Lucid estimates that the location of its first international manufacturing plant in the Kingdom may result in up to $3.4 billion of value to Lucid over 15 years.

The 25-year-contract will enable Lucid to address the growing demand for its products.

CEO Peter Rawlinson announced that Lucid aspires to be a catalyst for change, so it makes perfect sense to bring electric vehicles to one of the world's biggest oil-producing nations.

"Establishing a global manufacturing footprint is a practical, natural step and enables us to grow our brand, scale our business, and address worldwide and untapped market demand on an entirely new level, while also taking action to address climate change through inspiring sustainable transportation," he said.

Rawlinson noted that Lucid's strong relationships with PIF and its partners at MISA, KAEC, and SIDF also give "us unique insight into the demand for luxury cars and SUVs in Saudi Arabia and beyond, and we are thrilled to introduce the world's most advanced electric vehicles to more global markets."

Lucid also expects to benefit from the availability of competitively-priced commodities and energy and a newly emerging domestic supply chain, and a factory location that facilitates global logistics.

Lucid reviewed multiple opportunities before selecting KAEC in Saudi Arabia as the optimal location and option for its first international manufacturing facility.

The new manufacturing hub will be wholly owned by Lucid and enable the company to meet the growing international demand for luxury electric vehicles.

Lucid signed a contract with Emaar Economic City to rent land for its first facility to produce electric vehicles in the Kingdom.

The company sealed a $30 million deal to lease an industrial plot in King Abdullah Economic City Industrial Valley.

The financial impact from the project will roll out on the company's financial statements during the contract duration that will run from 2022 until 2047.

The step comes as Lucid aims "to construct and operate automotive manufacturing and assembly facility together with all ancillary services," Emaar Economic City said in a statement to the Saudi bourse.

Saudi Arabia wants to attract significant foreign factories and companies due to the local market's size, positively reflecting on the national economy.

The Kingdom provided all facilities for foreign investments by amending legislation and regulations, which will attract international companies and factories to the national market.



US Job Growth Surges in September, Unemployment Rate Falls to 4.1%

A woman enters a store next to a sign advertising job openings at Times Square in New York City, New York, US, August 6, 2021. REUTERS/Eduardo Munoz/File Photo
A woman enters a store next to a sign advertising job openings at Times Square in New York City, New York, US, August 6, 2021. REUTERS/Eduardo Munoz/File Photo
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US Job Growth Surges in September, Unemployment Rate Falls to 4.1%

A woman enters a store next to a sign advertising job openings at Times Square in New York City, New York, US, August 6, 2021. REUTERS/Eduardo Munoz/File Photo
A woman enters a store next to a sign advertising job openings at Times Square in New York City, New York, US, August 6, 2021. REUTERS/Eduardo Munoz/File Photo

US job growth accelerated in September and the unemployment slipped to 4.1%, further reducing the need for the Federal Reserve to maintain large interest rate cuts at its remaining two meetings this year.
Nonfarm payrolls increased by 254,000 jobs last month after rising by an upwardly revised 159,000 in August, the Labor Department's Bureau of Labor Statistics said in its closely watched employment report on Friday.
Economists polled by Reuters had forecast payrolls rising by 140,000 positions after advancing by a previously reported 142,000 in August.
The initial payrolls count for August has typically been revised higher over the past decade. Estimates for September's job gains ranged from 70,000 to 220,000.
The US labor market slowdown is being driven by tepid hiring against the backdrop of increased labor supply stemming mostly from a rise in immigration. Layoffs have remained low, which is underpinning the economy through solid consumer spending.
Average hourly earnings rose 0.4% after gaining 0.5% in August. Wages increased 4% year-on-year after climbing 3.9% in August.
The US unemployment rate dropped from 4.2% in August. It has jumped from 3.4% in April 2023, in part boosted by the 16-24 age cohort and rise in temporary layoffs during the annual automobile plant shutdowns in July.
The US Federal Reserve's policy setting committee kicked off its policy easing cycle with an unusually large half-percentage-point rate cut last month and Fed Chair Jerome Powell emphasized growing concerns over the health of the labor market.
While the labor market has taken a step back, annual benchmark revisions to national accounts data last week showed the economy in a much better shape than previously estimated, with upgrades to growth, income, savings and corporate profits.
This improved economic backdrop was acknowledged by Powell this week when he pushed back against investors' expectations for another half-percentage-point rate cut in November, saying “this is not a committee that feels like it is in a hurry to cut rates quickly.”
The Fed hiked rates by 525 basis points in 2022 and 2023, and delivered its first rate cut since 2020 last month. Its policy rate is currently set in the 4.75%-5.00% band.
Early on Friday, financial markets saw a roughly 71.5% chance of a quarter-point rate reduction in November, CME's FedWatch tool showed. The odds of a 50 basis points cut were around 28.5%.