Tesla launch in Saudi Arabia : symbol and strategy
The event, to be held at Bujairi Terrace, will offer the public the chance to discover Tesla's best-selling range, but also to “experience the future of autonomous driving with the Cybercab and meet Optimus, our humanoid robot, as we showcase what's coming in AI and robotics”, according to the company's official website.
A new market, a complex context
Firstly, this move comes at a difficult time for Tesla, which is facing a decline in worldwide sales, particularly in Europe, where its founder's diatribes are crystallizing tensions. Specifically, the company recorded a historic 1% drop in annual sales, the first since its IPO. In Europe, Tesla saw its sales drop by 42.6% at the start of 2025, even as overall sales of electric vehicles continued to grow on the continent. In China, sales plunged 49.2% in February, reaching their lowest level since August 2022. In its own US market, Tesla has to contend with the controversy surrounding Elon Musk's political role as head of the Department of Government Efficiency under the Trump administration. This appointment triggered a wave of peaceful protests, vandalism against showrooms and even the creation of a special FBI unit to “crack down on violent attacks against Tesla”. The company's share price has fallen by 40% since its peak in December 2024.
Faced with this situation, entering a dynamic new market like Saudi Arabia could offer the company a second wind.
Saudi Arabia, a fertile breeding ground for electric vehicles
For the moment, electric vehicles still account for just over 1% of car sales in the Kingdom, but the trend is clearly upwards. Indeed, the Saudi government is pursuing an existential strategy to reduce its dependence on oil through Vision 2030. The country's goal of carbon neutrality has already set in motion a series of policies to decarbonize the economy, with the electric car industry playing a central role. Tesla thus joins an industrial landscape and market in the throes of change. However, things won't be easy for the players involved. The Public Investment Fund (PIF), the Kingdom's sovereign wealth fund, is the main investor in Lucid Motors, a direct competitor of Tesla. Lucid opened its first plant outside the USA in Saudi Arabia in 2023, with an annual production capacity of 5,000 vehicles, and in January 2025 became the first global automaker to join the “Made in Saudi” program. At the same time, the Kingdom launched its own national electric vehicle brand, Ceer, announced in 2022 by Crown Prince Mohammed ben Salmane. Ceer signed eleven contracts in February 2025, worth a total of 5.5 billion Saudi riyals, and is scheduled for launch in 2026. The brand is expected to contribute 30 billion riyals ($7.9 billion) to Saudi GDP by 2034.
A step into the future, between technology and sustainability
Tesla's arrival in Saudi Arabia is not just an opportunity for the American automaker, it's also a powerful sounding board for the Kingdom's ambitions and successes. By welcoming one of the greatest symbols of innovation and sustainable mobility, Riyadh is sending out a clear signal: Saudi Arabia is decarbonizing its economy and becoming a global crossroads for technology, ecological transition and innovation. What's more, by attracting a world-renowned player, the country is strengthening its attractiveness to investors, international talent and companies looking for a promising, visionary market. This opening up to the big names in technological capitalism also demonstrates Saudi Arabia's ability to reposition its image on the international stage, far from the stereotypes it is sometimes given. The arrival of Tesla alongside Lucid Motors and the development of Ceer, for example, confirm the ambition of an economic model in which industrial innovation no longer opposes the environment, but is fully integrated into it.
Sources :
https://edition.cnn.com/2025/03/26/business/tesla-saudi-arabia-elon-musk-intl/index.html
https://www.arabnews.com/node/2594875/business-economy
