Lucid Motors CEO Peter Rawlinson poses on the Nasdaq MarketSite as Lucid Motors (Nasdaq: LCID) begins buying and selling on the Nasdaq inventory change after finishing its enterprise mixture with Churchill Capital Corp IV in New York Metropolis, New York, July 26, 2021.
Andrew Kelly | Reuters
Shares of electrical car maker Lucid Group had been down greater than 10% Wednesday following a downgrade of the corporate’s inventory by Financial institution of America and the abrupt departure of CEO Peter Rawlinson.
Rawlinson, who additionally served as chief know-how officer on the firm, was a driving pressure in its operations up to now, together with the choice to go public in 2021. Traders thought-about Rawlinson to be the face of the corporate — and essential to its success.
The corporate – majority owned by Saudi Arabia’s Public Investment Fund – is in quest of a brand new CEO, stirring uncertainty amongst Wall Road analysts.
“We expect the departure of Lucid’s (LCID) founder, CEO, and CTO, Peter Rawlinson is rather more consequential than understood by the market,” BofA Securities analyst John Murphy wrote in a Wednesday investor notice downgrading the inventory to underperform. “We now anticipate product improvement to stall, client demand to be dampened, and anticipate extra funding alternatives could possibly be put in danger.”
Interim CEO Marc Winterhoff, previously the corporate’s chief working officer, will try to make sure that’s not the case for Lucid.
Shares of Lucid, Tesla and Rivian in 2025.
Winterhoff stated in an interview with CNBC his goal is to construct upon Lucid’s success relatively than change its course. His high priorities embody greater than doubling car manufacturing this 12 months, narrowing losses and rising buyer consciousness and know-how choices.
“We have now a transparent imaginative and prescient. Now my focus can be on execution,” Winterhoff informed CNBC Tuesday forward of chatting with buyers on the corporate’s fourth-quarter earnings name.
Gross revenue
Lucid stays removed from worthwhile, but it surely has been narrowing its gross losses by rising scale and making its merchandise extra environment friendly.
Its GAAP gross margin, which incorporates manufacturing and gross sales however doesn’t consider different bills, for was a unfavourable 114% in 2024, enchancment from a unfavourable 225% in 2023.
“We anticipate a vital enchancment in gross margin in line with what we see in 2024 in contrast to 2023. So, we are on the proper trajectory,” Gagan Dhingra, Lucid’s interim CFO, informed buyers Tuesday.
For the fourth quarter, the corporate reported a internet loss attributable to frequent stockholders of $636.9 million, or a lack of 22 cents per share, on income of $234.5 million.
New merchandise
Lucid’s first product was the Air sedan, which it started delivering in late 2021. The expensive automotive has been praised for its styling and applied sciences, however demand for the car hasn’t been as robust as anticipated.
Winterhoff stated the corporate will proceed to provide Air sedans because it begins to ramp up manufacturing of its second product, an SUV called Gravity.
Lucid Gravity Grand Touring SUV
Lucid
Winterhoff stated manufacturing of the Gravity SUV will regularly construct this 12 months. He declined to invest Tuesday on what share of the 20,000-unit manufacturing goal the car would signify. He famous Gravity ordering for patrons in Saudi Arabia started earlier this month.
“We’re increasing our footprint and markets we’re very lively in, after which completely rising the ramp of Gravity, which is a giant, large focus for us proper now,” he stated in the course of the firm’s investor name.
Lucid is also within the midst of creating a brand new midsize car platform that is anticipated to launch on the finish of 2026, which each Winterhoff and Rawlinson have described as crucial to the automaker’s development.
‘Double down’ on advertising
Because the automaker will increase manufacturing and the variety of autos it affords, Winterhoff stated Lucid will “double down” on advertising and promoting to extend buyer consciousness.
“I am not planning to create a brand new imaginative and prescient or one thing like that for the corporate,” he informed CNBC. “What I am nonetheless specializing in is solely operational subjects, like, as an example, rising the deliveries for our prospects. We are going to double down on advertising. You will note rather more advertising from us.”
A Lucid showroom in New York Metropolis on Aug nineteenth, 2023.
Adam Jeffery | CNBC
The corporate’s promoting, basic and administrative bills had been $900 million in 2024, together with a $19.9 million improve in gross sales and advertising bills over the prior 12 months. The corporate’s whole advertising and promoting expense wasn’t instantly out there.
New tech, partnerships
The Lucid Air has been criticized for its lack of superior driver-assistant methods similar to Tesla’s “FSD” or General Motors’ “Tremendous Cruise.” Sure Air fashions value tens of hundreds of {dollars} greater than autos from opponents with such applied sciences.
Nonetheless, Lucid expects to launch a brand new hands-free driving system for patrons later this 12 months.
What Lucid lacks in driver-assistant applied sciences, it arguably makes up for in battery effectivity, as its automobiles are among the many best EVs within the U.S., based on federal information.
Lucid has tried to capitalize on its battery applied sciences by providing to promote them to different firms as a solution to improve scale and income.
Winterhoff stated the corporate stays in “fixed discussions” with firms about utilizing Lucid’s battery know-how however declined to offer extra particulars.
