Lucid Motors - the Tesla rival that's wooing the Saudis

2019 Chevrolet Volt

Tesla's stock woes are continuing amid worries about the viability of CEO Elon Musk's plan to take the automaker private.

The stock fell by as much as 6.7 per cent to a three-month low of $285 in morning trading in NY, some way off the $420-a-share take-private offer for which Mr Musk, the company's co-founder and chief executive, claimed to have secured funding this month.

Musk, a 47-year-old investor and engineer, stunned financial markets earlier this month, when he revealed on Twitter he was considering a $420 per share take-private deal for Tesla, an auto manufacturing pioneer that developed the world's first ever premium all-electric sedan vehicle.

That said, the mythical $35,000 Model 3 likely won't be available until September at the absolute earliest given that Tesla didn't hit a production rate of 5,000 units per week until the end of June.

On August 7, Musk surprised the investment world with a Twitter announcement that he was considering taking Tesla private and that the funds needed to do so - which some financial analysts estimate at more than $70 billion - were "secured".

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People familiar with the matter said on Sunday that PIF, the Saudi Arabian sovereign wealth fund that Musk says had been pressing to help fund the buyout, is in talks to invest in aspiring Tesla rival Lucid Motors Inc.

Funding would be a welcome new lease on life for Lucid, which had been trying to raise a series D round of USA $700 million previous year to get a plant up and running in Arizona.

Shares of Tesla sank to a three-month low, following the price cut, but have since reversed into positive territory. Then, over the weekend, Musk replied in a tweet to Arianna Huffington, who posted an open letter to the CEO on her wellness site Thrive Global Friday, urging Musk to reevaluate his long hours and get more sleep. The company later received a subpoena from the Securities and Exchange Commission over the tweet.

California-based Lucid Motors, formerly named Atieva, unveiled a prototype of a luxury sedan the Lucid Air at its unveiling in Fremont, California, U.S., December 14, 2016. The company has since assembled a team recruited from Mazda and Tesla, including Chief Technical Officer Peter Rawlinson, who was chief engineer of Tesla's Model S before joining in 2013.

The talks between privately-held Lucid Motors and PIF underscore the latter's appetite to invest in electric auto makers to diversify the oil-rich Middle Eastern kingdom's investment portfolio.

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