Tesla launched operations in Saudi Arabia on Thursday, signaling improved ties between CEO Elon Musk and the Kingdom. The move aligns with Saudi Arabia’s push for an ambitious electric vehicle (EV) policy as it diversifies beyond oil.
The Riyadh launch event featured a Cybertruck and redesigned Model Y amid palm-lined plazas, attracting crowds exploring the vehicles. Massive screens displayed the Cybertruck tackling desert dunes as attendees engaged with the cars.
A new era
Launching in the Kingdom of Saudi Arabia today 🇸🇦 pic.twitter.com/UyFgilD2kf
— Tesla Europe & Middle East (@teslaeurope) April 10, 2025
Challenges and Competition in the EV Race
Tesla seeks new growth markets after reporting a 13% global sales drop in Q1 2024. The decline marks its weakest performance in nearly three years, driven by Musk’s polarizing political ties, stiff competition, and aging models beyond the updated Model Y.
Saudi Arabia, a major Lucid Motors investor, aims for 30% EV adoption by 2029—up from 1% in 2023. Rivals like China’s BYD, Zeekr, and Lucid (backed by Saudi’s Public Investment Fund) already operate in the Kingdom.
Saudi faces significant hurdles to meet its EV goals. The 900-km Riyadh-Makkah highway lacks charging stations, and the Kingdom had just 101 public chargers in 2024—far fewer than the UAE’s 261 stations. Tesla plans initial charging hubs in three cities.
From Feud to Partnership
Musk feuded with the Kingdom’s sovereign wealth fund over a potential investment nearly a decade ago, but relations between Riyadh and the Tesla CEO have improved since he took a role in US President Donald Trump’s election campaign and administration.
Tesla’s Saudi team outlined plans for online sales, mall pop-ups, Supercharger networks, and service centers. Musk skipped the launch, but his Cybertruck’s desert spectacle underscored Tesla’s bid to electrify the oil-rich nation.
As Saudi Arabia charges toward its 30% EV adoption target, Tesla’s desert debut marks a high-voltage chapter in the Kingdom’s transformation story.
