Lucid Motors to Build Next-Gen EVs in Saudi Arabia to Sidestep US Tariffs
Luxury electric vehicle company shifts midsize model production to Saudi plant to avoid high duties on Chinese components
Lucid Motors has announced plans to manufacture its next-generation midsize electric vehicles at its plant in Saudi Arabia, a move designed to circumvent steep U.S. import tariffs on Chinese-sourced parts.
The company’s chief financial officer, Taoufiq Boussaid, told investors at the UBS Global Industrials and Transportation Conference that the “fortunate space” of having a Saudi facility provides Lucid with the option to import the bill of materials — including components from China — without incurring significant duty.
The facility, located in King Abdullah Economic City and opened in 2023, was originally intended to support Saudi demand under a major purchase commitment by the kingdom.
Now it is evolving into a strategic production hub with global implications.
The midsize EV platform, underpinning at least three planned models, is slated for initial production in late 2026 or 2027. According to Lucid, these vehicles will be positioned at around fifty-thousand U.S. dollars, placing them in a more competitive segment than the company’s current luxury lineup.
The shift aligns with Saudi Arabia’s economic strategy under Vision 2030 to foster domestic manufacturing and reduce reliance on imports.
It also allows Lucid to sidestep protectionist U.S. trade measures that have raised costs for several automakers.
For Lucid, the move is part of a broader attempt to stabilise production and reduce unit costs amid a volatile global supply-chain environment.
Despite previous supply-chain disruptions and a cut to its 2025 production forecast, the company continues to expand its Saudi footprint: the King Abdullah Economic City facility is expected to scale toward full capacity by the end of the decade, supplying vehicles not just to the Gulf region but potentially for export to Europe and other markets.
The decision underscores the growing importance of Middle Eastern manufacturing in the global electric vehicle landscape and highlights how geopolitics and trade policy are shaping where and how EVs are built.
The company’s chief financial officer, Taoufiq Boussaid, told investors at the UBS Global Industrials and Transportation Conference that the “fortunate space” of having a Saudi facility provides Lucid with the option to import the bill of materials — including components from China — without incurring significant duty.
The facility, located in King Abdullah Economic City and opened in 2023, was originally intended to support Saudi demand under a major purchase commitment by the kingdom.
Now it is evolving into a strategic production hub with global implications.
The midsize EV platform, underpinning at least three planned models, is slated for initial production in late 2026 or 2027. According to Lucid, these vehicles will be positioned at around fifty-thousand U.S. dollars, placing them in a more competitive segment than the company’s current luxury lineup.
The shift aligns with Saudi Arabia’s economic strategy under Vision 2030 to foster domestic manufacturing and reduce reliance on imports.
It also allows Lucid to sidestep protectionist U.S. trade measures that have raised costs for several automakers.
For Lucid, the move is part of a broader attempt to stabilise production and reduce unit costs amid a volatile global supply-chain environment.
Despite previous supply-chain disruptions and a cut to its 2025 production forecast, the company continues to expand its Saudi footprint: the King Abdullah Economic City facility is expected to scale toward full capacity by the end of the decade, supplying vehicles not just to the Gulf region but potentially for export to Europe and other markets.
The decision underscores the growing importance of Middle Eastern manufacturing in the global electric vehicle landscape and highlights how geopolitics and trade policy are shaping where and how EVs are built.
