Tesla opens Riyadh showroom amid infrastructure gaps and cheap fuel

Tesla has opened its first showroom in Saudi Arabia, marking a significant step into a market traditionally dominated by gasoline vehicles.

The launch in Riyadh comes at a time when Tesla is facing global sales declines and growing scrutiny of its CEO, Elon Musk, due in part to his political affiliations and lack of new vehicle models.

Despite being one of the world's largest oil exporters, Saudi Arabia’s EV adoption remains low, with only around 800 EVs sold last year, though that figure has tripled from the year before. Fuel remains cheap in the kingdom, costing about €0.57 per liter, and the lack of charging infrastructure—only 101 stations nationwide—remains a key obstacle.

Saudi Arabia is actively working to diversify its economy.

The Public Investment Fund (PIF) owns a 60% stake in U.S.-based Lucid Motors and has partnered with Hyundai to establish a local EV factory. Meanwhile, the kingdom’s own EV brand, CEER, plans to begin production in 2025.

Tesla’s arrival adds to a growing EV presence in the kingdom, which includes Lucid, Chinese automaker BYD, and future local manufacturers—though the road to widespread EV adoption remains long.