Tesla opens its doors in Saudi Arabia, amid past tensions with Musk
- Tesla's Saudi Arabian launch includes its first showroom and service center in Riyadh, opening the door to a new market.
- Elon Musk's past conflicts with Saudi Arabia's Public Investment Fund over a failed deal in 2018 add complexity to this new entry.
- Despite ongoing infrastructure challenges, including a lack of charging stations, the government's investment in EVs reflects a commitment to future growth.
On April 11, 2025, Tesla officially launched its operations in Saudi Arabia, marking a significant step in its global expansion efforts. The launch included the opening of its first showroom and service center in the capital city of Riyadh. This event comes in the wake of a fraught relationship between Tesla CEO Elon Musk and Saudi Arabia, particularly due to Musk's controversial 2018 claim that he had secured funding from the Saudi Public Investment Fund to take Tesla private. This partnership fell through, leaving lingering tensions between the two parties. Despite launching in a country where the electric vehicle (EV) market is still nascent, with only around 2,000 EVs sold in all of 2023, Tesla's entrance signifies optimism about the future of electric mobility in the region. The Saudi government is investing approximately $39 billion in EV initiatives, aiming to have 30% of vehicles in the capital be electric by 2030. However, challenges remain, particularly with the current lack of infrastructure, as Saudi Arabia only had 101 public charging stations available, predominantly located in major cities. Tesla offers various models, including the Model 3, Model Y, and the recently announced Cybertruck, hoping to capture interest in a market that has shown increasing interest in electric vehicles. Musk has garnered a large fanbase in Saudi Arabia, where many admire his forward-thinking approach and view Tesla as a vital player in the global automotive landscape. Despite Tesla's expansion efforts, some concerns loom regarding the Saudi climate, which could affect battery performance and efficiency. The relationship between Musk and the Saudi government remains complex, underscored by their history of strained interactions but also linked to a broader vision for economic diversification. As Saudi Arabia seeks to reduce its dependency on oil, the country views electric vehicles as a critical component of its Vision 2030 strategy, which aims for significant improvements in sustainability and technological growth in the coming years.