Saudi Arabia prepares for electric vehicle revolution by building extensive charging network

Saudi Arabia is making significant strides in the electric vehicle (EV) sector as part of its efforts to diversify the economy away from oil dependency. The Electric Vehicle Infrastructure Company (EVIQ), which aims to transform the country's EV landscape, reported that as of the end of 2023, there were around 285 public charging points spread mainly across Riyadh and Jeddah, where most of them are slow chargers. The nation has now opened its first fast charging station in Riyadh in January 2024 as a precursor to an ambitious plan to install 5,000 fast chargers in 1,000 locations by 2030. This move aligns with Saudi Arabia's goal to have 30% of cars in its capital, Riyadh, be electric by that same year, highlighting the kingdom's commitment to reshaping its automotive landscape. Additionally, gaining traction among domestic consumers, which predominantly purchase EVs to charge at home, is integral to promoting wider adoption of electric vehicles. A notable challenge remains the higher prices of many EV models; more than 60% of available models were priced over $65,000 in 2024, compared to 73% of gasoline-powered vehicles under that price point. Coupled with the generous fuel subsidies, where a liter of gasoline costs around 60 cents, many Saudis might opt for traditional vehicles instead. Recognizing these barriers, the Saudi government has indicated the introduction of financial incentives, such as VAT exemptions for new EVs and subsidized charging, needed to spur the market. A survey in May 2024 by the King Abdullah Petroleum Studies and Research Center suggested that incentives and improved infrastructure could be fundamental in overcoming these challenges for a large-scale adoption of EVs in urban areas like Riyadh. As part of Saudi's commitment to building an industrial ecosystem around electric vehicles, the kingdom has initiated several endeavors, including a joint venture between the Public Investment Fund (PIF) and Taiwanese company Foxconn, aiming to produce its first EV by 2026. There’s also a manufacturing plant being established through a collaboration between PIF and Hyundai. In addition, companies like BYD from China opened their first showroom in the kingdom in May 2024, while Tesla commenced operations in April of the same year. Industry experts predict that while the 30% electric vehicle goal set for Riyadh is achievable, additional efforts may be necessary to stimulate broader EV adoption across the entire country. With a comprehensive strategy in place, the kingdom is addressing critical issues that have historically impeded the growth of the EV sector. Experts have noted that while there is a clear trajectory for decreased EV prices, an increase in model availability, and positive signaling from the government, “range anxiety” still poses a concern for potential buyers. Nonetheless, Saudi Arabia's commitment to building a functional charging network and nurturing a local automotive industry demonstrates its ambition of becoming a leader in electric mobility in the region.