Lucid Motors Struggles with Electric Vehicle Demand and Slashes Production Targets for 2024

Fremont, San Francisco – Lucid Motors, based in California, has announced its plans to produce just 9,000 electric vehicles in 2024, a relatively modest increase from the number made in 2023. This comes as the company grapples with the challenge of meeting demand for its luxury sedans. The current production target is only around 10% of the 90,000 EVs it initially predicted it would be able to manufacture and sell in 2024 when it first became publicly listed three years ago.

The stark contrast between these figures and the company’s earlier expectations highlights the flexibility afforded to companies like Lucid in touting reverse mergers that facilitated their transition to becoming publicly traded entities. It also underscores the harsh reality that Lucid is currently confronting – a struggle to attract buyers and profit from each EV it produces.

The announcement of the 2024 production goals was made alongside the company’s disclosure of a $2.8 billion loss in 2023. This modest projection follows the recent price reduction of its Air sedan by $8,000. CEO Peter Rawlinson has been emphasizing the importance of improving sales and marketing efforts, as well as pinning hopes on the upcoming Gravity SUV as a potential catalyst for growth.

The Gravity, originally expected to outsell the Air sedan in 2024, faced setbacks including supply chain and production issues, resulting in a delay in its launch. However, the company revealed the SUV in November 2023 and plans to commence production by the end of this year. The Gravity’s success is crucial for Lucid’s near-term future, and the company rewarded Rawlinson with a $6 million cash bonus for unveiling the SUV.

In addition to these developments, Lucid recently began selling a rear-wheel drive version of its base model Air Pure, priced under $70,000 after the price cuts. The company has also struck a deal with Aston Martin to supply some of its EV technology. Furthermore, Saudi Arabia, the majority owner of Lucid Motors, has agreed to purchase up to 100,000 EVs from the company over the next decade. However, initial challenges were experienced when shipping Air sedans to the Kingdom.

These recent announcements shed light on the complexities and challenges faced by Lucid Motors, as it navigates a rapidly evolving market for electric vehicles. The company’s journey to establish itself as a key player in the industry appears to be fraught with obstacles, but it continues to explore strategic partnerships and innovations to drive growth and sustainability.