Lucid has revised its manufacturing outlook for 2023 on account of declining demand for luxurious electrical automobiles, the corporate mentioned in its third-quarter earnings report on Tuesday.
The EV maker mentioned it would produce 8,000 to eight,500 automobiles by the tip of the yr, down from a earlier forecast of greater than 10,000, to “prudently modify deliveries.”
Within the third quarter, Lucid delivered 1,457 of its luxurious electrical Air sedans, exceeding Wall Avenue expectations by about 500 automobiles. Yr-over-year and quarter-over-quarter, Lucid’s cargo figures had been broadly steady.
The revised manufacturing tips and weak supply figures come as customers are unwilling to spend so much on electrical automobiles, preferring to go for extra budget-friendly hybrids. To maintain up with demand, corporations world wide have been on the lookout for methods to supply electrical automobiles at a cheaper price. Tesla has constantly lowered its costs throughout the board to spice up gross sales. And automotive producers akin to Ford and Rivian are attempting to convey cheaper fashions to the market.
In August, Lucid began chopping costs throughout its whole Air vary. Final week, the EV maker doubled the value of its Air Touring mannequin from $95,000 to $87,500, and the Grand Touring by $10,000 to $115,600. The all-wheel drive Air Pure now additionally prices $74,900, down from $82,400.
Although they’re cheaper, these automobiles are nonetheless costly, and Lucid is about to unveil one other luxurious EV mannequin that can doubtless be simply as costly.
Lucid’s Gravity SUV will probably be unveiled subsequent week. The corporate mentioned manufacturing will nonetheless start in late 2024. The worth for that automotive has not but been introduced, however it’s anticipated to be round $100,000.
Lucid missed Wall Avenue’s estimates
Lucid reported $137.8 million within the third quarter, lacking Wall Avenue estimates of $192.72 million by a large margin, in response to Yahoo Finance information. That income is down about 30% from the identical interval in 2022, when Lucid reported a revenue of $195.5 million.
A part of this may be attributed to restructuring prices. In March, Lucid laid off 18% of its workforce, or about 1,300 workers, to scale back prices on the firm. Lucid mentioned its restructuring efforts would additionally result in different value financial savings, however the automaker’s spending on promoting, normal and administrative prices has grown yr over yr.
Lucid ended the quarter with a internet lack of $630.8 million. The automaker nonetheless has $1.16 billion in money and money equivalents and a complete of $5.45 billion in liquidity, which Sherry Home, Lucid’s CFO, says will get the Gravity into manufacturing and assist the corporate survive by way of 2025 to remain upright.
“Now we have additionally made progress on the associated fee containment program we applied within the first half of the yr and have recognized additional alternatives for 2024,” Home mentioned in an announcement.
Whereas Lucid’s liquidity place could also be robust proper now, the automaker nonetheless ended the quarter with detrimental free money move of -$706 million, a transparent signal that Lucid is not bringing in sufficient money to cowl its excessive prices.
In keeping with Home, Lucid expects to spend between $1 billion and $1.1 billion on capital expenditures this yr as the corporate strategically invests in manufacturing capability, retail studios and repair facilities, and vendor instruments for the Gravity.
Shares of Lucid fell practically 7% in after-hours buying and selling on Tuesday.
