Electric cars in the Gulf Area an investment market and challenges to spread

Abstract

Global automakers hurried to switch to electric motors at the same time asEurope declared war on oil and gas emissions that contribute to global warming,which sparked a broad debate about the future of oil and how the Gulf countrieswill handle this transformation. The European Commission released last July thatit is going to study a strategy to halt the sale and production of cars that run onfossil fuels by 2035 and motivate the shift towards electric vehicles andtransportation, which will seriously impact the economies of the petroleumcountries, and Arab countries in particular. This is due to the growing threat ofclimate change as well as the sharp increase in oil prices around the world.Based on the most recent data for 2019, the world's transportation industry isresponsible for close to 60% of the yearly oil demand. It is well recognized thatthe transportation industry encompasses not just automobiles, buses, and trucks,but also ships, aircraft, and military hardware.Although experts predict that charging car batteries will needs electricityproduced by power plants using oil derivatives, data from 2019 showed that theamount of oil used to generate electricity does not increase 5% of the estimatedworldwide consumption of oil, with the majority of it being consumed indeveloping nations. In addition to depending on nuclear energy and renewableenergy sources, the technological advancement in the battery business would alsolessen reliance on oil for the production of power. Considering the findings of thestudy that I received, vehicle sales in the UAE and KSA would be able towithstand a flood of EVs of up to 30% by 2030. Saudi Arabia aims for at least 30percent of its cars to be electric powered by 2030, following its pledge to reachnet zero carbon emissions by 2060. Last year, EV manufacturer Lucid announceda long-term plan to build the first international manufacturing plant in SaudiArabia, targeting 150,000 vehicles per year at the King Abdullah Economic City.Meanwhile, the UAE is pushing for 42,000 EVs to be on its streets within thenext decade. To meet the rise in demand for green mobility, the UAE opened itsfirst electric vehicle manufacturing facility in Dubai Industrial City last month,built at a total cost of $408 million. The facility is expected to produce 55,000cars per year.