Prime Highlights
- BYD will dramatically increase its network of Saudi Arabian showrooms to more than double by 2026.
- Tesla’s entry into the market is expected to increase the profile of electric vehicles throughout the Kingdom.
Key Facts
- EVs account for just over 1% of the sale of motor vehicles in Saudi Arabia because of affordability and infrastructure concerns.
- BYD out-sold Tesla in Europe for the first time last month.
Key Background
Chinese electric vehicle giant BYD is expanding its presence in Saudi Arabia, looking to increase from three to ten showrooms by 2026. The information was made public by BYD managing director for Saudi Arabia, highlighting the need for high volume performance in an effort to succeed in the advanced local market. The expansion comes as the Kingdom begins to feel more competition, particularly with Tesla’s recent launch of its first showroom in Riyadh in April.
Saudi Arabia is quickly transforming into a regional electric vehicle (EV) hub in the guise of Vision 2030, which has ambitious goals like having 30% of Riyadh’s cars on electric roads by the end of the decade. Banking on the Public Investment Fund (PIF), the government has funded numerous ventures like investments in Lucid Motors, transforming national EV brand Ceer, and initiatives to increase charging infrastructure.
Despite such investments, electric vehicle adoption is sluggish in the Kingdom. EVs account for approximately 1% of the automobile segment, driven by exorbitant prices, few charging stations, and extreme weather conditions leading to battery degradation. A recent survey shows that, however, customer interest is growing, with approximately half of Saudi Arabia’s potential buyers looking to purchase an electric vehicle as their next acquisition.
Tesla’s entry into the Saudi market will be a major source of consumer knowledge regarding electric mobility. BYD views this as positive, stating that more publicity and advertising from Tesla will benefit the entire industry. BYD is building momentum in the international market, having recently outsold Tesla for the first time in European sales. This momentum, supported by strong government backing and expanding public interest, sets Saudi Arabia on the verge of a revolutionary transformation in its auto sector.
