Manufacturing Technology
Tesla Launches In Saudi Arabia Amid Challenges, Competition & Controversy
Updated on Fri, Apr 11, 2025
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Tesla has finally launched in the Kingdom of Saudi Arabia!
The move comes as the global demand for electric vehicles (EVs) has grown at an unprecedented rate.
Of course, this news didn’t come as a surprise as the company had a launch event for just about anyone to attend. All they had to do was sign up and let the company know how many people they were bringing (a max of 3 additional guests), but they had to RSVP fast, as space was limited.
Attendees were also required to disclose which vehicles they were interested in—picking between Model Y, Model 3, and Cybertruck.
Held at the Bujairi Terrace on April 10, Tesla was also set to treat visitors to products such as Cybercab and Optimus—the company’s humanoid robot—as Tesla also showcased what was next in AI and robotics.
“Explore our global bestselling lineup and step into a world powered by solar energy, sustained by batteries, and driven by electric vehicles,” blared a message on the registration page on Tesla’s website.
Tesla’s first showroom and service center opened in Saudi Arabia’s capital and largest city—Riyadh—on April 11, along with more stores in Jeddah and Dammam.
However, it isn’t going to be an easy ride for Tesla in the country, as its path forward appears to be filled with rough roads, rivalry, and regulatory wrangling, resulting in reduced sales.
Saudi Arabia possesses a 900-kilometre (559-mile) stretch that spans the main east-west highway connecting Riyadh with the holy city of Mecca. This road does not have a single charging station. Studies show that EV buyers in the Middle East expect EVs to deliver long ranges between charges.
Additionally, the country sits in a rather hot region—going past 50 degrees Celsius (122 degrees Fahrenheit)—which leads to EV batteries draining a lot faster than normal.
This is one of the biggest reasons why sales of EVs remain low in the country—2024’s tally reportedly included just 2,000 EVs being sold across the kingdom.
As such, Saudi Arabia trails the United Arab Emirates when it comes to EV charging stations—Saudi Arabia has 101 compared to UAE’s 261. Interestingly, Saudi Arabia has three times the population the UAE has.
BYD's general manager in Saudi Arabia, Carlos Montenegro, also agrees that this statistic poses a problem, which is why the global leader in EV sales primarily sells hybrid cars in the country, with 70% of its cars sold accounting for hybrids.
“I think charging is probably one of the main, if not the main, point of concern," said Montenegro.
BYD is challenging Tesla not only in the region but also globally.
However, that’s not where the competition ends as Tesla also faces competition from Saudi-owned EV brands Ceer Motors and Lucid Motors—all competing for an extremely small market, where EVs accounted for only 1% of all car sales (as per PwC).
Ceer Motors also plans to expand across the Middle East in 2025.
“Tesla won’t be a pioneer in the market. In other countries, it was very often the first one—in Saudi Arabia, not anymore,” said Tatiana Hristova, Director of CEE and MEA vehicle sales forecasting at S&P Global Mobility.
S&P Global Mobility expects Tesla to sell just 10,000 to 15,000 EVs in its first two years in the kingdom.
“After that, it will definitely face very strong competition from the side of locally manufactured competitors, and also Chinese vehicles,” she added.
A silver lining for Tesla is that Saudi Arabia has been pushing in the EV space by investing an estimated $39 billion as per its Vision 2030 program, which also included transitioning 30% of all cars in Riyadh to be electric and halving emissions by 2030—initiatives Tesla initially missed out on.
It’s no secret that Tesla is embroiled in controversy in the United States as Elon Musk played a major role in President Donald Trump’s successful election campaign to lead the country.
Furthermore, Musk is currently leading DOGE (Department of Government Efficiency), which is facing backlash from numerous federal workers and the public for cutting spending, shutting departments, and firing workers, which has affected at least 20,000 federal employees.
This includes cutting around 30 jobs at the National Highway Traffic Safety Administration (NHTSA)—an organization that closely regulates Tesla—most of which were from the “office of vehicle automation safety.” The NHTSA has eight active investigations against Tesla after receiving and publishing over 10,000 complaints.
“There is a clear conflict of interest in allowing someone with a business interest influence over appointments and policy at the agency regulating them,” said a senior NHTSA executive not affected by the “cleanup.”
Tesla’s controversies aren’t restricted to these new developments alone, at least not as far as Saudi Arabia and the governor of the kingdom's sovereign wealth fund goes, courtesy of Elon Musk. The feud between these two parties stretches as far back as 2018, when he tweeted that he had “funding secured” to take Tesla private following a meeting with the fund. This even led to a lawsuit from investors when the deal didn’t come to fruition.
However, Musk’s newfound high-profile role in the White House has managed to ease the tension.
His Saudi Arabian move comes just before a planned visit by the U.S. President to the kingdom, as part of his first foreign trip.
Despite the improving diplomatic relations between Saudi Arabia and the U.S., Tesla has a big mountain (or should we say sand dune?) to climb if it wants to achieve success in the region, as it deals with numerous challenges, competition, and controversies.
Outside Saudi Arabia, Tesla has stopped taking orders for Model S and Model X vehicles on its Chinese website and its WeChat mini-program account.
In the U.S., Tesla launched a new version of its “Long Range” Cybertruck priced at 69,990—which comes down to $56,490 with a $7,500 tax credit (for purchasing a clean vehicle) and an estimated 5-year gas savings of $6,000. It also offers a 350-mile range and 7,500-lbs. towing capacity.
This adds to the other two variants—All-Wheel Drive for $79,990 ($66,490 with savings), with a 325-mile range and 11,000-lbs. towing capacity, and Cyberbeast for $103,490 ($89,990 with savings), with a 301-mile range and 11,000-lbs. towing capacity.
Pricing plans include full cash, 36 months/10,000 miles lease, and 84-month, 6.49% APR financing.
Do you think Tesla will taste success in Saudi Arabia?
Let us know in the comments below!
The move comes as the global demand for electric vehicles (EVs) has grown at an unprecedented rate.
Of course, this news didn’t come as a surprise as the company had a launch event for just about anyone to attend. All they had to do was sign up and let the company know how many people they were bringing (a max of 3 additional guests), but they had to RSVP fast, as space was limited.
Attendees were also required to disclose which vehicles they were interested in—picking between Model Y, Model 3, and Cybertruck.
Held at the Bujairi Terrace on April 10, Tesla was also set to treat visitors to products such as Cybercab and Optimus—the company’s humanoid robot—as Tesla also showcased what was next in AI and robotics.
“Explore our global bestselling lineup and step into a world powered by solar energy, sustained by batteries, and driven by electric vehicles,” blared a message on the registration page on Tesla’s website.
Tesla’s first showroom and service center opened in Saudi Arabia’s capital and largest city—Riyadh—on April 11, along with more stores in Jeddah and Dammam.
However, it isn’t going to be an easy ride for Tesla in the country, as its path forward appears to be filled with rough roads, rivalry, and regulatory wrangling, resulting in reduced sales.
The Challenges
Saudi Arabia possesses a 900-kilometre (559-mile) stretch that spans the main east-west highway connecting Riyadh with the holy city of Mecca. This road does not have a single charging station. Studies show that EV buyers in the Middle East expect EVs to deliver long ranges between charges.
Additionally, the country sits in a rather hot region—going past 50 degrees Celsius (122 degrees Fahrenheit)—which leads to EV batteries draining a lot faster than normal.
This is one of the biggest reasons why sales of EVs remain low in the country—2024’s tally reportedly included just 2,000 EVs being sold across the kingdom.
As such, Saudi Arabia trails the United Arab Emirates when it comes to EV charging stations—Saudi Arabia has 101 compared to UAE’s 261. Interestingly, Saudi Arabia has three times the population the UAE has.
BYD's general manager in Saudi Arabia, Carlos Montenegro, also agrees that this statistic poses a problem, which is why the global leader in EV sales primarily sells hybrid cars in the country, with 70% of its cars sold accounting for hybrids.
“I think charging is probably one of the main, if not the main, point of concern," said Montenegro.
The Competition
BYD is challenging Tesla not only in the region but also globally.
However, that’s not where the competition ends as Tesla also faces competition from Saudi-owned EV brands Ceer Motors and Lucid Motors—all competing for an extremely small market, where EVs accounted for only 1% of all car sales (as per PwC).
Ceer Motors also plans to expand across the Middle East in 2025.
“Tesla won’t be a pioneer in the market. In other countries, it was very often the first one—in Saudi Arabia, not anymore,” said Tatiana Hristova, Director of CEE and MEA vehicle sales forecasting at S&P Global Mobility.
S&P Global Mobility expects Tesla to sell just 10,000 to 15,000 EVs in its first two years in the kingdom.
“After that, it will definitely face very strong competition from the side of locally manufactured competitors, and also Chinese vehicles,” she added.
A silver lining for Tesla is that Saudi Arabia has been pushing in the EV space by investing an estimated $39 billion as per its Vision 2030 program, which also included transitioning 30% of all cars in Riyadh to be electric and halving emissions by 2030—initiatives Tesla initially missed out on.
The Controversy
It’s no secret that Tesla is embroiled in controversy in the United States as Elon Musk played a major role in President Donald Trump’s successful election campaign to lead the country.
Furthermore, Musk is currently leading DOGE (Department of Government Efficiency), which is facing backlash from numerous federal workers and the public for cutting spending, shutting departments, and firing workers, which has affected at least 20,000 federal employees.
This includes cutting around 30 jobs at the National Highway Traffic Safety Administration (NHTSA)—an organization that closely regulates Tesla—most of which were from the “office of vehicle automation safety.” The NHTSA has eight active investigations against Tesla after receiving and publishing over 10,000 complaints.
“There is a clear conflict of interest in allowing someone with a business interest influence over appointments and policy at the agency regulating them,” said a senior NHTSA executive not affected by the “cleanup.”
Tesla’s controversies aren’t restricted to these new developments alone, at least not as far as Saudi Arabia and the governor of the kingdom's sovereign wealth fund goes, courtesy of Elon Musk. The feud between these two parties stretches as far back as 2018, when he tweeted that he had “funding secured” to take Tesla private following a meeting with the fund. This even led to a lawsuit from investors when the deal didn’t come to fruition.
However, Musk’s newfound high-profile role in the White House has managed to ease the tension.
His Saudi Arabian move comes just before a planned visit by the U.S. President to the kingdom, as part of his first foreign trip.
Despite the improving diplomatic relations between Saudi Arabia and the U.S., Tesla has a big mountain (or should we say sand dune?) to climb if it wants to achieve success in the region, as it deals with numerous challenges, competition, and controversies.
Outside Saudi Arabia, Tesla has stopped taking orders for Model S and Model X vehicles on its Chinese website and its WeChat mini-program account.
In the U.S., Tesla launched a new version of its “Long Range” Cybertruck priced at 69,990—which comes down to $56,490 with a $7,500 tax credit (for purchasing a clean vehicle) and an estimated 5-year gas savings of $6,000. It also offers a 350-mile range and 7,500-lbs. towing capacity.
This adds to the other two variants—All-Wheel Drive for $79,990 ($66,490 with savings), with a 325-mile range and 11,000-lbs. towing capacity, and Cyberbeast for $103,490 ($89,990 with savings), with a 301-mile range and 11,000-lbs. towing capacity.
Pricing plans include full cash, 36 months/10,000 miles lease, and 84-month, 6.49% APR financing.
Do you think Tesla will taste success in Saudi Arabia?
Let us know in the comments below!
First published on Fri, Apr 11, 2025
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