Lucid revises 2023 production amid softening demand for luxury EVs
Lucid has revised its 2023 production outlook amid slowing demand for luxury electric vehicles, the company announced Tuesday during its third quarter. income report.
The electric vehicle maker said it would produce between 8,000 and 8,500 vehicles by the end of the year, down from previous forecasts of more than 10,000, in order to “prudently align with deliveries.”
In the third trimester, Lucid delivered 1,457 of its Air luxury electric sedans, missing Wall Street expectations by about 500 vehicles. Year-over-year and quarter-over-quarter, Lucid’s delivery numbers have remained more or less stable.
The revised production forecasts and low delivery figures come as consumers are unwilling to spend big on electric vehicles, preferring instead to opt for more economical hybrids. To answer the question, companies around the world have been looking for ways to offer electric vehicles at a lower price. Tesla was constantly lowering prices at all levels to stimulate sales. And car manufacturers like Ford And Rivien strive to market cheaper models.
In August, Lucid began cutting prices across the entire Air line. Last week, the The electric vehicle manufacturer has doubled its stake, reducing the price of its Air Touring model to $87,500, from $95,000, and the Grand Touring by $10,000 to $115,600. The all-wheel-drive Air Pure also now costs $74,900, up from $82,400.
Although cheaper, these cars are still expensive, and Lucid is about to reveal another luxury EV model that will likely be just as expensive.
Lucid Gravity SUV should be revealed next week. The company said production is still expected to begin in late 2024. Pricing for this car has not yet been revealed, but it is expected to be around $100,000.
Lucid missed Wall Street estimates
Lucid reported $137.8 million in the third quarter, far missing Wall Street estimates of $192.72 million, according to Yahoo Finance data. That revenue is down about 30% from the same period in 2022, when Lucid reported a profit of $195.5 million.
Part of this can be attributed to restructuring costs. In March, Lucid laid off 18% of its staff, or around 1,300 employees, to reduce company costs. Lucid said its restructuring efforts would also result in other cost reductions, but the automaker’s spending on selling, general and administrative expenses increased year over year.
Lucid closed the quarter with a net loss of $630.8 million. The automaker still has $1.16 billion in cash and cash equivalents and a total of $5.45 billion in liquidity, which Sherry House, Lucid’s chief financial officer, said will help put the Gravity in production and help the company stay afloat until 2025.
“We also made progress on the cost control program we implemented in the first half of the year and identified new opportunities for 2024,” House said in a statement.
While Lucid’s liquidity position may be strong at the moment, the automaker still closed the quarter with negative free cash flow of -$706 million, a stark sign that Lucid is not generating enough cash. liquidity to cover its high costs.
For the year, Lucid plans to spend between $1 billion and $1.1 billion in capital expenditures as the company strategically invests in manufacturing capacity, retail studios and service centers, as well as vendor tools for Gravity, according to House.
Lucid’s stock fell nearly 7% after hours Tuesday.
