Summary List Placement
Somewhere out there, there’s a graveyard of Tesla rivals — metal skeletons of electric cars that tried and failed to challenge Elon Musk.
Lucid Motors probably would’ve been one of them, had it not been for Saudi Arabia.
After struggling for years, Lucid Motors was saved by a $1.3 billion investment from Saudi Arabia’s sovereign wealth fund in 2019. The huge sum gave the Saudi fund a 67% stake in the company, according to Wired Middle East.
Flash forward to today and Lucid Motors is set to go public with the largest-ever SPAC deal, pocketing $4.4 billion at a valuation of $24 billion. It will increase Saudi Arabia’s ownership to 85%, according to the company’s investor presentation.
Lucid Motors announced late Monday that it will merge with Churchill Capital Corp IV, the SPAC run by investor Michael Klein. It’s the latest in the SPAC craze, which has been a popular option among electric car companies such as Nikola and Fisker. Investors in Churchill Capital Corp IV include Millennium, Citadel, and Blackstone.
Although there’s been a boom of electric vehicle startups in the last few years, it’s proven difficult and costly to turn pipe dream designs into viable models. Lucid Motors, however, has actually built a entire factory in Arizona to mass-produce the Lucid Air, its initial luxury sedan priced at around $70,000.
CEO Peter Rawlinson is confident the Lucid Air can take on Musk.
“We’ve got more advanced technology than Tesla,” he previously told Insider. He estimates the company’s technology is 17% more efficient than its closest competitor.
But despite its new massive valuation, Lucid Motors hasn’t had an easy journey.
The path to a $24 billion valuation
Rawlinson originally worked at Lotus and Jaguar, before leading vehicle engineering at Tesla. He was a chief engineer for the Model S, before leaving in 2012 to care for his mother.
Musk was not happy.
“Rawlinson didn’t design Model S,” Musk tweeted in 2020. “Prototype was done before he joined & he left us in the lurch just as things got tough, which was not cool.”
One can imagine Musk was even less thrilled when Rawlinson joined Silicon Valley startup Atieva a year later. The company was in the middle of switching from supplying batteries to producing electric cars.
It became Lucid Motors in 2016, and set out to develop a luxury electric sedan. However, the company struggled for years to secure funding. As The Verge reported earlier this year, Lucid Motors was forced to take on loans from an Arizona hedge fund and a Chinese electric bus company to continue operating.
Then Saudi Arabia stepped in.
Saudia Arabia’s Public Investment Fund (PIF) gave Lucid Motors a staggering $1.3 billion, which it used to build its $700 million factory in Arizona.
Saudi’s investment was likely part of Crown Prince Mohammed bin Salman’s 2030 Vision, which declared the country’s push towards green energy. Saudi Arabia even initially tried investing in Tesla, before Musk’s famous “secured funding” tweet likely spoiled the deal.
Am considering taking Tesla private at $420. Funding secured.
Source:: Businessinsider – Tech
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