Lucid Group (NASDAQ: LCID) stock surged during intraday trading on Monday after the electric vehicle maker announced robust second-quarter delivery figures.
On Monday, Lucid reported better-than-expected second-quarter deliveries, driven by strategic price cuts that stimulated demand for its luxury electric sedans.
The electric vehicle (EV) market has faced challenges in the past year, including high borrowing costs, economic uncertainties, and consumer preferences shifting towards hybrid alternatives, slowing the growth of EV adoption.
In response to market conditions, Lucid and other industry leaders like Tesla have implemented significant price cuts and offered incentives such as cheaper financing options to attract consumers. Lucid notably slashed prices of its flagship Air sedans by up to 10% in February, a move that appears to have paid off.
Production Targets and Analyst Outlook
Lucid produced 3,838 vehicles in the first half of 2024, with an ambitious target of producing more than 5,162 vehicles in the remaining months to meet its annual forecast of 9,000 units. This target follows their production of 8,428 automobiles in 2023.
Senior equity analyst at Cantor Fitzgerald, Andres Sheppard, remains optimistic, stating,
“I think at this point, everything is shaping for them to achieve that guidance.”
He also noted that Lucid will ramp up production and deliveries in the latter half of the year, aligning with typical seasonal patterns in the automotive industry.
Q2 Delivery Results
Lucid delivered 2,394 vehicles in the quarter ending June 30, beating the analyst estimate of 1,940 units, according to data from eight analysts polled by Visible Alpha.
Rivian Automotive (NASDAQ: RIVN) and Tesla also reported encouraging second-quarter delivery figures recently, with Rivian showing upbeat results and Tesla posting a smaller-than-expected decline.
Lucid (NASDAQ: LCID), backed by Saudi Arabia’s Public Investment Fund with a 60% stake, outlined plans in May to increase its capital expenditure to $1.5 billion in 2024, up from $910.6 million the previous year. This investment surge is intended to support the upcoming production launch of its Gravity SUV, priced around $80,000, which will directly compete with Tesla’s Model X. Lucid’s Air sedan, on the other hand, competes with Elon Musk-led EV maker’s popular Model S.
Lucid will report its quarterly financial results on August 5, providing further insights into its operational performance and market strategy amidst competitive pressures in the EV sector.
Lucid (NASDAQ: LCID) Stock Movement
LCID stock jumped 7.85% on Monday, closing at $3.16, marking a 21.07% increase for the week. The trading volume was 61,558,732 shares, significantly higher than the average daily volume of 22.90 million.