Are Price Cuts Paying Off for Lucid?

• Lucid reports that it delivered 1,728 units of the Air sedan in the first quarter of 2024, while also delivering 1,967 units, seeing a modest decline from the previous quarter but also setting a quarterly record in the process.
• The EV maker has introduced several phases of price cuts in 2023 and 2024, and has recently launched a more expensive version of the Air sedan.
• Lucid recently received a $1 billion investment from its majority shareholder, an affiliate of Saudi Arabia’s Public Investment Fund, through a stock sale.

A year ago Lucid was in the midst of cost-cutting measures, slashing the prices of the Air sedan while also reducing its numbers. In fact, the luxury EV maker revealed at the time that it was laying off some 18% of its workforce in a bid to save up to $30 million in costs.

Things had been mixed, despite the high marks the Air sedan received from the automotive press, with the Gravity sedan still months away from its unveiling. And other EV manufacturers seemed pessimistic about 2023 as well.

A year later, Lucid appears to be heading in the right direction after reporting that it produced 1,728 units of its Air sedan while also delivering 1,967 units, a quarterly delivery record for the automaker.

By comparison, in the fourth quarter of last year the EV maker produced 2,391 sedans while delivering only 1,734, prompting further reports of weak demand that has hampered EV makers for much of the year. And in the first quarter of 2023, Lucid reported only 1,406 sedan deliveries.

Therefore, production has fallen in the last quarter significantly.

A few weeks ago Lucid introduced its latest price cut, dropping the price by $1,000 on the Grand Touring model, and $8,000 on the Touring. That’s after another notable round of price cuts last August that resulted The Air Grand Touring has dropped its price by $12,550with other design-only versions seeing significant price cuts as well.

The foundation The price of the Air Pure has dropped by $7,500 a few weeks ago.

Do price cuts pay off in the short term?

It’s still a complicated picture, with Lucid having seen a rough year and a half as the industry worries about slowing demand. By relying on a single EV model, albeit available in different specifications and price ranges, Lucid could only afford to lower the price even if it started sales of its cheapest model in the summer of 2023.

Unlike Tesla, it didn’t have a wider range of reliability, and it saw stiff competition not only from Tesla but all the arrivals of the luxury electric sedan from Team Germany.

Now, Lucid is months away from the start of production of the Gravity SUV, having also revealed plans for a third and more affordable model, aimed at the Tesla Model Y. However, this third model is still far from production, scheduled to launch. in 2026, by which time the EV market may seem unrecognizable.

Last month Lucid also secured a $1 billion investment from partner Saudi Arabia’s Public Investment Fund through a share sale, with Ayar Investment Company already holding a majority stake.

“With their support, we remain focused on accelerating our growth through transportation, executing key business initiatives with a relentless focus on cost, and launching our game-changing Gravity SUV later this year,” Lucid CEO Peters Rawlinson said at the time.

It should take the rest of 2024 to see if Lucid has been able to deal with the back demand successfully, but the Gravity SUV should improve its outlook by the end of the year.

Will Lucid be able to find an audience for its Gravity SUV, or is buyer interest shifting to smaller, cheaper models? Let us know what you think in the comments below.

Jay Ramey grew up around the incredible European cars, and instead of looking for something reliable and comfortable for his personal use he has been drawn to the more interesting side of the reliability spectrum. Despite being obsessed with French cars for the past decade, he has somehow managed to avoid owning a Citroën, judging them too ordinary, and is currently looking at cars from the former Czechoslovakia. Jay has been with Autoweek since 2013.