Luxury electric vehicle (EV) manufacturer, Lucid, recently announced that it fell short on deliveries in the third quarter, failing to meet the expectations of both Wall Street and investors. The company reported that it delivered 1,457 of its high-end all-electric Air sedans during this period, which was approximately 500 vehicles below what was anticipated.
Key Takeaway
Luxury EV maker Lucid has fallen short on deliveries in the third quarter, missing Wall Street expectations by about 500 vehicles. Year-over-year growth is nearly flat, and the company’s shares have dropped around 3.6% as a result. The deal with Saudi Arabia, which aims to purchase 100,000 Lucid vehicles over the next ten years, may offer a lifeline for Lucid as it looks to expand production capacity and rebound from recent challenges.
A Disappointing Year-Over-Year Comparison Reflects Stagnant Growth
What’s even more concerning for Lucid is the year-over-year comparison. The company delivered 1,398 vehicles in the third quarter of 2022, indicating a nearly stagnant growth rate over the past year. Similarly, on a quarter-over-quarter basis, Lucid’s third-quarter deliveries were only slightly higher than the 1,404 vehicles delivered in the second quarter. These results reflect a potential softening of demand for the company’s sole EV offering.
Investor Concerns Prompt a Stock Decline
Following the announcement, Lucid’s shares experienced a decline of about 3.6%. This drop has heightened investor concerns about the company’s ability to meet market demand for its luxury EVs.
Production Figures Highlight Vehicle Output
Lucid also revealed that it produced 1,550 Airs during the third quarter. Additionally, the company reported that over 700 vehicles are currently being transported to Saudi Arabia for final assembly. It’s worth noting that Lucid produced 2,282 vehicles in the third quarter of 2022.
Ups and Downs for Lucid Throughout the Year
Lucid has faced a series of challenges throughout the year. These include hitting a production milestone in January, falling short of delivery expectations in February, recalling hundreds of vehicles and downsizing its workforce in March, and posting weaker-than-anticipated revenue and earnings in May. In June, the company secured a deal with Aston Martin, while in July, it failed to meet expectations for the second quarter.
Saudi Arabian Deal Offers Hope for Lucid’s Future
Despite the setbacks, Lucid’s deal with Saudi Arabia could provide a lifeline for the company. The Saudi Arabian government, connected to the kingdom’s Public Investment Fund, which owns 60% of Lucid, declared intentions to purchase 100,000 of the automaker’s electric vehicles over the next decade. Lucid opened a factory in Saudi Arabia in September, initially capable of assembling 5,000 Lucid vehicles per year. The company plans to expand the facility, allowing for a production capacity of up to 150,000 vehicles. Initially, workers at the plant will re-assemble Lucid Air vehicle kits that are pre-manufactured at the company’s US factory in Casa Grande, Arizona. Lucid aims to transition the Saudi Arabian factory to complete build unit production after the middle of this decade.
