Electric car maker Lucid Group said on Tuesday it had signed an agreement with the Saudi Arabian government to buy up to 100,000 of its cars over the next 10 years.
Saudi Arabia has promised to buy 50,000 cars under the agreement, with the option to buy an additional 50,000 cars over a ten-year period, Lucid said in a statement.
Lucid shares rose 5.4% in extended trading after the announcement.
The deal marks the latest deal between the California-based EV Company and Saudi Arabia, whose public investment fund, Lucid’s largest shareholder, holds about 61% of the company.
Lucid, which currently builds its vehicles at a plant in Arizona, plans to build its first overseas manufacturing plant in Saudi Arabia later this year, where it expects to eventually build up to 150,000 cars a year.
Vehicles purchased by the Saudi government are expected to come from two factories, Lucid said.
Vehicle delivery is expected to begin after 2023, with the number of orders initially increasing from 1,000 to 2,000 per year and from 2025 to 4,000 to 7,000.
A Lucid spokesman said the company had not offered a discount on any vehicles under the agreement.
In a regulatory filing, Lucid said the Saudi government would pay US or Saudi retail prices, whichever is lower, in addition to import and other delivery costs.
The automaker, which appears to be competing with Tesla, cut its production forecast for February 2022 from 20,000 vehicles to 12,000 to 14,000 vehicles due to supply chain challenges.
It began delivering its $ 169,000 Lucid Air premium sedan in the United States in October and said it expects to deliver to Canadian customers early this spring.