US electric vehicle start-up Lucid Motors is reported to be in talks with Saudi Arabia’s Public Investment Fund about building an electric vehicle plant in the kingdom.

The news was reported by the UK’s Financial Times earlier this week, with the newspaper citing an interview with the head of the sovereign fund, Al-Rumayyan.

Bloomberg subsequently reported the two parties had discussed setting up a plant in the Saudi city of Jeddah, on the Red Sea coast.

The Public Investment Fund reportedly invested over US$1bn in Lucid Motor’s in 2018 on the understanding the carmaker would build a manufacturing plant in the country.

The Saudi government has been investing heavily in recent years to diversify the economy away from the oil sector and is seeking to attract international companies to set up operations in the kingdom.

Lucid Motors last month announced it had completed construction of its first electric vehicle plant in Arizona.

The AMP-1 (Advanced Manufacturing Plant) is scheduled to begin commercial production of the Air passenger car early this year with a second model – the Gravity – to be added later in the year.