Saudi Arabia reportedly in talks with Tesla to set up electric vehicle manufacturing plant

Saudi Arabia is in talks with US electric carmaker Tesla TSLA-Q to establish a manufacturing plant in the kingdom, the Wall Street Journal reported on Monday, citing sources familiar with the matter.

The report comes just hours after Turkish President Tayyip Erdogan asked Tesla CEO Elon Musk to build an auto factory in Turkey, according to the country’s communications directorate.

Musk is also expected to meet with Israeli Prime Minister Benjamin Netanyahu in California on Monday.

Saudi Arabia is wooing Tesla with the right to buy certain quantities of metals and minerals the company needs for its electric vehicles from countries including the Democratic Republic of Congo, according to the report.

The kingdom is trying to shift its economy away from oil, while its sovereign wealth fund is the majority investor in Lucid Group, one of the electric vehicle startups seeking to challenge Tesla’s dominance of the industry.

One proposal the kingdom is considering is providing financing to commodities trader Trafigura for a troubled Congolese cobalt and copper project, which could help supply a Tesla factory, according to the WSJ report.

A Trafigura spokesperson said the trader was reviewing its options for Congo’s Mutoshi project amid rising costs and continued low cobalt prices.

Tesla did not immediately respond to Reuters’ requests for comment, while Saudi Arabia’s sovereign wealth fund, the Public Investment Fund, declined to comment.

Musk said in May that Tesla would likely choose a location for a new factory by the end of 2023. It currently has six factories and is building a seventh in Mexico, in the northern state of Nuevo Leon.

Tesla aims to sell 20 million vehicles per year by 2030, up from around 1.3 million in 2022.