Tesla opens doors in Saudi Arabia

Falling sales, violent protests and uncertainty around tariffs have forced Tesla boss Elon Musk to take unexpected action.

Tesla is rushing to do business in Saudi Arabia in a bid to offset a drop in sales across Europe and the US.

The brand will start with pop-up stores and customer activations before investing in conventional showrooms in cities such as Riyadh and Jeddah.

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Anti-Tesla protests in the US and beyond have hit the company hard. Photo: Annabelle GORDON / AFP

The electric vehicle giant is looking for new markets that can take in cars that aren’t being bought in countries where sales are falling.

The brand has recorded sales drops of around 70 per cent in major markets such as Germany and the US.

In America, Reuters has reported that people are trading in Teslas at triple the volume of the same period last year.

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Tesla’s pivot to Saudi Arabia represents an unexpected backflip from the brand – not just because drivers in the Middle East gravitate toward petrol-powered vehicles.

But because Tesla chief executive Elon Musk clashed with Saudi’s sovereign Public Investment Fund back in 2018.

Am considering taking Tesla private at $420. Funding secured.

— Elon Musk (@elonmusk) August 7, 2018

Musk tweeted at the time that he had “funding secured” to take Tesla private in a deal that would have reaped billions for shareholders who sued him when the agreement fell through.

The Saudi PIF then rubbed salt into the wound by backing one of Tesla’s key competitors in Lucid Motors.

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Saudi Arabia is increasingly open for business, highlighted by its role hosting Formula One races. Photo: Clive Mason/Getty Images

As a result, Tesla elected not to sell cars in Saudi Arabia, preferring to take its business elsewhere.

But the brand’s current sales crisis has forced it to backtrack and look for new opportunities to maintain production and sales numbers around the globe.

Originally published as Tesla opens doors in Saudi Arabia