Last week Tesla co-founder and CEO Elon Musk manufactured some his finest … headlines.
This time those headlines resonated from plans for taking his company public – a $70+ billion endeavor that revolved around purchasing existing stock for $420/share. The funding for such an endeavor, according to Musk’s Twitter account and numerous other news outlets, would come in large part from Saudi Arabia’s $250 billion sovereign wealth fund, called the Public Investment Fund or PIF.
The PIF bought a five percent stake in Tesla last month. However, according a recent Reuters report, the Saudi government has shifted its interest from Tesla to a potential competitor.
Based in California but funded by a Chinese joint venture, Lucid Motors is currently developing a line of 1,000-horsepower electric sports cars called Air.
The vehicles were the focus of an IEN Now last summer when they were clocked at 235 mph – beating the top speed of Ferrari’s electric vehicle. It also boasts a battery range of 400 miles. The base models are projected to start at a price of $60,000, with features and options taking them into the six figures.
The rumored deal would have the PIF sending $1 billion to Lucid, which it would use to help fund construction of a manufacturing facility in Casa Grande, Arizona. These funds would also be used to start production of the Air, hopefully as soon as next year, with the first car hitting the streets in 2022.
The infusion of cash, which would be nearly $70 billion less than the Tesla deal, would make the PIF the majority stakeholder in Lucid.The money would reportedly be provided in three installments – with half coming up front and the remainder dependent upon production and profitability goals.
Such a deal benefits both sides, as the infusion of cash would allow Lucid to move beyond the prototype phase, while the oil-dependent interests of Saudi Arabia are insulated against trends moving away from gasoline-powered automobiles.
So far, neither deal the Lucid or Tesla deal has been confirmed by PIF representatives.