Tesla announced on its website that it will start sales in Saudi Arabia next month.

The announcement of Tesla starting sales in Saudi Arabia indicates the end of tension between CEO Elon Musk and Saudi officials. The tension began with Musk’s attempt to delist Tesla from the stock market in 2018. While Tesla was selling in some Middle Eastern countries, it was not selling in Saudi Arabia, the region’s largest market. The share of electric vehicles (EVs) in total car sales in the country is only 1%. In contrast, the Tesla brand has seen great success in neighboring United Arab Emirates, where most ride-sharing apps offer electric vehicles.

2018 TENSION

In 2018, after discussions with Saudi Arabia’s Public Investment Fund (PIF), Musk tweeted that “funding secured” to delist Tesla from the stock market. However, when this plan did not materialize, investors sued Musk. During this period, tense messages between Musk and PIF President Yasir al-Rumayyan were also leaked to the public. However, relations began to improve in the fall. Musk became a significant figure in the new administration of U.S. President Donald Trump after actively participating in Trump’s election campaign. Trump announced this month that he would make his first international visit to Saudi Arabia during his presidency.

In January, Musk also demanded the Saudi government to invest $1 trillion in the U.S. economy within four years, especially in military purchases. In Saudi Arabia, brands like Chinese BYD and PIF-backed Lucid (LCID.O) already sell electric vehicles. According to a PwC report dated 2024, electric vehicle sales in the country make up only 1% of the total automotive market.

TESLA’S SAUDI ARABIA PLAN

Tesla will enter the Saudi Arabia market with a launch event in Riyadh on April 10th, showcasing its electric vehicles and solar-powered products. The announcement also mentioned experiencing the future of autonomous driving with Cybercab and meeting our humanoid robot named Optimus to see what lies ahead in artificial intelligence and robotics. The company also stated that it will open temporary stores in Riyadh, Jeddah, and Dammam on April 11th and announce its long-term investment plans in Saudi Arabia in the coming weeks. Tesla plans to invest in the country for 2025 and beyond.