Swedish electric boat startup Candela has signed a deal to sell eight of its vessels — half of all its orders so far — to the Saudi Arabian government entity Neom.
The roughly €1.7m deal isn’t going to break the bank for the Saudi organisation, which has a $500bn budget for its futuristic megaproject, to build ten cities in a 26,500 km sq area in the Saudi Arabian desert. For Candela though, it’s a significant partnership.
“This (Neom) is a highly ambitious project. They are building everything from scratch with the idea of having all transportation fossil-free. It’s exciting to be a part of that”, Candela’s founder and CEO Gustav Hasselskog says.
Candela, which was founded in 2014, has developed a hydrofoil craft — with an underwater fin that is designed to lift a moving boat out of the water to reduce drag — that uses 80% less energy than other ships and boats when it “flies”, according to the company. The startup’s vessels will be used to transport people around Neom’s sites bordering the Red Sea.
Controversy
The Saudi project has attracted other European startups such as German electric taxi startup Volocopter, Polish startup AI Clearing and London-based One Web. But, earlier this year, Neom hit the headlines for the wrong reasons when a local protester against the construction project was allegedly killed by the country’s military, according to BBC reporting.
A statement issued by Saudi state security alleged the victim had opened fire on security forces and they had been forced to retaliate.
In addition, around 6k local residents have been evicted and relocated from sites tied to Neom developments, according to the Saudi government. 40 people who’ve resisted relocation are in detention, according to the UN and the human rights group ALQST, five of whom are on death row, according to ALQST.
In response to human rights concerns at least one company, the UK desalination startup Solar Waterout, has withdrawn from its $100m contract with Neom that it had signed in 2019. Neom declined to comment to Sifted.
For Candela, the controversy about the construction project hasn’t impacted its decision to sell its vessels to Neom.
“All countries in the world must contribute to making transport emission-free. It’s not a sustainable line for a company like Candela to make some kind of shortlist of countries that we can sell to. All countries, including North Korea, need to switch to a fossil-free economy,” he says. “So the moral question is rather simple.”
Since the company had its first vessel ready for launch last year it has been able to showcase it on the sea outside Stockholm, which has meant a bump in the interest of commercial customers globally. Apart from Saudi, Candela says it also has ongoing conversations with clients in Qatar and the UAE.
But apart from a small pilot project for the Stockholm public transport that will commence this autumn, it has been a slower pickup in Europe.
“I cannot see another reason but the democratic processes are slower. It’s an old truth that there is a downside to democracies, but the positives outweigh the negative,” Hasselskog says.
Read the orginal article: https://sifted.eu/articles/neom-candela-sweden-startup-news/
