When Elon Musk started to talk about the prospects of taking Tesla, he was counting on the support of the Saudi Arabian sovereign wealth fund to help finance the move. But now according to reports from “people familiar with the matter” Tesla might have to compete with Lucid Motors for the investment money.
According to reports, PIF and Lucid Motors have drawn up a term sheet that would have PIF obtain majority ownership of the company. PIF could invest more than $1 billion, starting with an initial $500 million investment and then further cash injections that would be contingent on whether or not Lucid Motors meets certain milestones.
The sources were very clear in saying that the deal had not taken place yet and there is a possibility that it won’t result in a deal.
The Saudi fund is worth up towards $250 billion, and while they have intentions to diversify their oil-heavy investment portfolio, helping to take Tesla private might be too much for them. Estimates to take Tesla private have been anywhere from $10 billion to $72 billion. The fund already has other investments in place, including a large $45 billion agreement to invest in a technology fund led by Japan’s SoftBank Group. It might make more sense for them to invest a much smaller amount into Lucid Motors who look to be creating a real competitor to the Model S.
Based in Newark, California Lucid Motors was founded in 2007 as Atieva by Bernard Tse, a former Vice President and board member of Tesla. In the early years the company produced batteries for electric cars, buses, and motorcycles. In 2013 Lucid Motors hired Peter Rawlinson, another VP from Tesla and Chief Engineer of the Model S. Since 2016, they’ve been working on their Model S competitor, the Lucid Air.
The Lucid Air is another ambitious car with great specs coming from a new manufacture. Difference is that this time, there are a lot of experience from former Tesla employees leading the way, so the Lucid Air might actually deliver on its promises. The base model starting at $60,000 will have 400 hp and 240 miles of range, for that price, performance, and luxury found inside the cabin, it will be the car to beat. You can further option of the car allowing you to opt for a duel motor setup making 1000 hp giving a 0-60 time of 2.5 seconds along with a 400 mile range.
Lucid Motors will start to build its factory in Arizona soon to start producing the Lucid Air. Perhaps the Saudi fund sees Lucid Motors disrupting Tesla’s dominance.
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