Shares of Tesla Inc. (TSLA) rose by 0.3% in premarket trading on Monday, following a report by The Wall Street Journal stating that the electric vehicle giant is currently in discussions to establish a manufacturing facility in the Kingdom of Saudi Arabia. This move is seen as part of Saudi Arabia's efforts to secure metals necessary for electric vehicle production and to diversify its economy away from oil.
According to sources familiar with the discussions, these talks are still in their early stages and there is a possibility that they may not materialize. However, if successful, this venture could have significant implications for both Tesla and the Saudi Arabian economy.
Potential Boost Amidst UAW Strikes
The recent UAW strikes affecting the Big 3 automakers have positioned Tesla as a potential beneficiary, driving its stock up by as much as 1.1% intraday on Friday, reaching a two-month high. However, the stock ultimately closed down by 0.6% at the end of the day. Nonetheless, over the past three months, Tesla's stock has shown resilience by gaining 5.3%, outperforming the S&P 500 which has only managed a 0.9% increase during the same period.
The talks between Tesla and Saudi Arabia serve as a testament to the growing prominence of electric vehicles and the global shift towards sustainable transportation solutions. As these discussions progress, investors are keeping a close eye on any developments that may arise, providing potential opportunities for both Tesla and the Kingdom.