US electric vehicle manufacturer Tesla Inc. will enter the Saudi Arabian market in early April 2025, the company announced in a press release on March 26.

Tesla vehicles are currently sold throughout the Middle East except Saudi Arabia, which represents the largest market in the Gulf region. The move comes as Tesla seeks new growth opportunities while facing challenges in established markets.

The company will showcase its electric vehicles (EVs), humanoid robots and solar-powered products at a press conference in Riyadh on April 10. Industry analysts expect the Model Y and Cybertruck to feature prominently in Tesla's Saudi launch strategy.

Tesla sales have fallen 42.6% in Europe compared to the previous year. In the US, the company has faced protests over Elon Musk's policy of cutting federal agency staff and foreign aid across thousands of programmes and contracts.

Saudi Arabia, as part of its economic diversification strategy outlined in Vision 2030, has invested significantly in electric vehicle startups including Lucid Group. The Saudi Public Investment Fund (PIF) has provided substantial funding to Lucid, which opened a manufacturing plant in the kingdom in 2024.

Musk previously denied reports about negotiations to build a Tesla factory in Saudi Arabia, though industry observers speculate local production could become necessary if import regulations tighten. The kingdom has been actively promoting domestic manufacturing across multiple sectors.

Tesla enters a Saudi market already developing its own EV ecosystem. In November 2024, Saudi Arabia's first EV manufacturer Ceer partnered with Croatia's Rimac Technology to supply high-performance electric drive systems for its flagship EV range.

Ceer, a joint venture between Saudi Arabia's PIF and Foxconn, plans to design and manufacture EVs for Saudi and MENA markets, with the company expected to attract over $150mn in foreign direct investment (FDI) and contribute $8bn to Saudi Arabia's GDP by 2034.

Tesla is an American multinational manufacturer of EVs, charging stations and energy storage systems. The company designs, develops, produces and sells electric cars and their components and provides leasing services and non-warranty after-sales service. Its headquarters are located in Austin, Texas.

In 2018, Elon Musk and Tesla Inc agreed to pay $40m in penalties and implement significant corporate governance changes to settle securities fraud charges brought by the Securities and Exchange Commission. The settlement required Musk to step down as Tesla's chairman for at least three years while remaining chief executive.

The SEC charged Musk with securities fraud over his August 7, 2018 tweets claiming he could take Tesla private at $420 per share with "funding secured." The regulator alleged these statements lacked factual basis and misled investors.

There is no indication whether Musk is seeking funding from the Saudi government amid declining sales in other markets, though analysts note the kingdom's sovereign wealth fund has the capital and strategic interest to potentially become a significant Tesla investor.