US battery electric vehicle (BEV) manufacturer, Tesla Inc, has launched sales operations in oil-rich Saudi Arabia, taking on existing zero-emission brands such as US manufacturer Lucid and China’s BYD in a market dominated by large petrol-driven SUVs.
The US automaker has opened sales outlets in the cities of Riyadh, Jeddah and Dammam, as it looks to emulate the relative success it has enjoyed in neighbouring markets such as the United Arab Emirates (UAE), where the company is appealing to a small but growing number of urban buyers.
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The launch comes as Tesla sales in a large number of markets worldwide have fallen in recent months, which has been partly blamed on the company’s owner Elon Musk’s close allegiance with newly-elected US President Donald Trump. The company’s global sales fell by 13% year-on-year to 336,681 units in the first quarter of 2025, including a 9% drop in US sales to 128,100 units. The company’s share price has almost halved since Donald Trump won the US Presidential election in November.
Naseem Akbarzada, Tesla country manager for Saudi Arabia, told reporters this week: “Today we are proud to officially launch in the kingdom, marking the start of a long-term presence in the country.”
Tesla plans to build a network of charging stations for its customers, starting in the three cities where it has opened sales outlets. But recharging facilities on the country’s desert inter-city highways remains limited.
Saudi economist Mohammed Al-Qahtani welcomed Tesla entry into the market, but urged the company to invest more in the country, saying “we do not want a showroom, we want a factory. We want to be part of the production process, not just consumption.”
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