A deal with the Saudis could help Musk achieve his ambitious goal of selling 20 million vehicles a year by 2030 – up from just 1.3 million sold in 2022.
The move is part of an ambitious push by the kingdom to diversify its economy away from oil and secure metals needed to make electric cars.
But it comes amid a series of high-profile human rights abuses by the authoritative regime in Saudi Arabia, which has been cracking down increasingly hard on peaceful dissent.
Last month, a court sentenced a retired Saudi teacher to death over a series of tweets that were critical of the regime.
Self-proclaimed ‘free speech absolutist’ Elon Musk is in talks to open a Tesla factory in Saudi Arabia
The report comes just hours after Turkish President Tayyip Erdogan asked Musk to build a vehicle factory in Turkey, according to the country’s communications directorate.
Musk is also set to meet Israeli Prime Minister Benjamin Netanyahu in California on Monday.
Saudi Arabia has been wooing Tesla with the right to purchase certain quantities of metals and minerals the company needs for its electric vehicles from countries, including the Democratic Republic of Congo, the report said.
The kingdom has been trying to shift its economy away from oil, while its sovereign wealth fund is the majority investor in Lucid Group (LCID.O), one of the EV startups looking to challenge Tesla’s dominance of the industry.
One of the proposals the kingdom is considering involves extending financing to commodities trader Trafigura for a flailing Congo cobalt and copper project, which could help provide a Tesla factory with supplies, the WSJ report said.
A Trafigura spokesperson said the trader was reviewing its options for the Mutoshi project in Congo amid rising costs and persistently low cobalt prices.
Tesla did not immediately respond to Reuters requests for comment, while Saudi Arabia’s sovereign fund, the Public Investment Fund, declined to comment.
Musk said in May Tesla would probably pick a location for a new factory by the end of 2023. It currently has six factories and is building a seventh in Mexico in northern Nuevo Leon state.