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Lucid Group Inc. plans to produce around 14,000 EVs this year. According to a statement issued on Wednesday, the EV manufacturer set this lofty production goal in response to looming economic uncertainty.
In today’s live breaking news, Peter Rawlinson, Chief Executive of Lucid Group, said the production target for EVs fell short of the analysts’ expectations of 21,000 units. However, the company decided to keep the figure at 14,000 amid the economic uncertainties facing the industry. The trucks and cars on the market are becoming expensive because of rising interest rates.
Defers plant expansion
Sherry House, CFO of Lucid Group, said the company took this decision considering the difficult environment in the market, especially the market uncertainty and surging interest rates, which put a burden on the buyer. The company also included factors like an increase in the cost of parts and a reduction in shipping charges. It also deferred the expansion of its plant-based in Casa Grande, Arizona, to save costs.
Lucid Group’s target of 14,000 units this year is almost double that of the previous year. Apart from citing economic uncertainty, the company also cited parts shortages for some of the Lucid Air versions, which are in great demand, as a reason for limiting the production target.
Maintains reservations for 28,000 units
According to a communiqué from Lucid Group, the number of reservations for its vehicles declined from 34,000 at the end of September 2022 to 28,000 as of February 21, 2023. The analysts cited the drop in reservations and reduced wait times as a sign of slowing demand for Lucid EVs. The starting price of Lucid EVs is $87,000, but it could go up to more than $100,000.
Ms. House said the company decided not to go ahead with reporting quarterly reservation figures and instead report delivery and production figures. According to Mr. Rawlinson, the demand for various versions of Lucid, including Air Pure, remained strong.
Mr. Rawlinson said the company had to reduce production in 2022 because of certain issues, which resulted in cancellations of reservations by consumers. The company also offered discounts on some models to boost demand for its vehicles. Analysts, however, stated that it is in opposition to declining demand for Lucid vehicles.
Losses were reduced to $2.56 billion
The company has already started narrowing its previous losses. It has lowered the losses from $4.75 billion in 2021 to $2.56 billion in 2022. It made $608.21 million in revenue in 2022, up from $27.1 million the previous year. Lucid Group posted revenues of $257.7 million in Q4 compared to $26.4 million in the same period last year.
According to the latest BNN News, Lucid Group will accept reservations for its Gravity, a sport utility vehicle, this year. According to Mr. Rawlinson, the company is on track to commence production of Gravity in 2024. The company already bagged an order for the supply of around 100,000 vehicles overseas for official use by the Saudis. He went on to say that its success is based on its vision of how to sell more vehicles this year. The company already produces the best car in the world, and there is a need to improve awareness about its new vehicles worldwide.
