LIV Golf Files for Bankruptcy After Saudi Funding Withdrawal

LIV Golf, once fully funded by Saudi Arabia’s Public Investment Fund (PIF), has filed for Chapter 11 bankruptcy protection in the US after PIF withdrew its support. The golf tour, which paid one player a reported £450 million signing fee, struggled to demonstrate a clear return on investment. PIF’s decision to pull the plug on LIV Golf came despite earlier assurances of long-term backing, leaving the tour in a precarious financial position and seeking new funding. The bankruptcy filing includes creditors like the United Nations High Commissioner for Refugees, further complicating its future.

LIV Golf’s downfall raises questions about the sustainability of PIF-backed ventures. Ceer, a new Saudi car company, claims to be “fully funded until 2040”—a phrase eerily similar to assurances once given by LIV Golf’s CEO. However, history shows that PIF’s investments are not always guaranteed for such extended periods, with some commitments spanning up to 14 years in advance yet remaining subject to change. This track record casts doubt on the certainty of Ceer’s funding claims.

Ceer’s domestic focus differentiates it from LIV Golf

Unlike LIV Golf’s international ambitions, Ceer aims to boost Saudi Arabia’s GDP and diversify its economy away from oil. However, the automotive industry is notoriously difficult to enter, with high overheads and complex supply chains. Ceer’s domestic focus aligns with Saudi Arabia’s broader economic goals, but the automotive sector’s competitive nature and the lack of significant new global entrants this century, aside from Tesla and some Chinese brands, show the challenges ahead.

PIF’s automotive investments face challenges

PIF’s investment in Lucid, another electric vehicle company with Saudi production plans, has shown promise but has not matched Tesla’s early success. Lucid’s technology is widely regarded as best-in-class, yet its market penetration and sales figures have lagged behind expectations. Ceer, being a domestic project, may benefit from greater PIF influence, but it lags behind Lucid in development, facing the additional hurdle of building a brand from scratch in a crowded market.