Tesla CEO Elon Musk recently suggested that a go-private plan for Tesla would involve the Saudi sovereign wealth fund, known officially as the Public Investment Fund as a key partner in a future delisting.
Analysts and commenters have been quick to note the irony of the world’s most famous electric-car company and the world’s most prominent oil-economy skeptic working with the world’s largest petroleum economy.
However, that complaint overlooks that the PIF is supposed to diversify the Saudis away from oil. Over the long haul, the kingdom is aware that the crude will run out. Beyond that, oil as a transportation fuel might also decline in the 21st century.
The PIF participation is logical: if you want to diversify beyond oil, the world’s premier EV company is a dramatic way to do it. Making big investments in Tesla has also paid off. Both Daimler and Toyota bought in after Tesla survived a brush with bankruptcy in 2008; when those companies got out, they booked considerable returns.
