Electric vehicle (EV) company — and Tesla rival — Lucid reported stronger than expected first quarter revenue, beating estimates, as well as strong customer demand for its Lucid Air models, with reservations now exceeding 30,000. The company also said that it will be increasing the prices of its vehicles at the beginning of June, “reflecting cost increases in the commodity, supply chain and logistics and market,” per an earnings call transcript.

                By                    Yaёl Bizouati-Kennedy

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The company reported revenue of $57.7 million, driven by customer deliveries of 360 vehicles in the quarter. The more than 30,000 customer reservations for the Lucid Air line-up reflect potential sales of $2.9 billion, the company said in a press release. The revenue beat analyst estimates by $2.4 billion, according to Seeking Alpha.

Shares closed down 7% on May 5 amid a broad market selloff. 

“We also announced today that we are increasing prices of our vehicles that will go into effect at the beginning of June. The world has changed dramatically from the time we first announced Lucid Air pricing in September 2020, but I want to reassure our existing reservation holders that we will be honoring current pricing for them as well as for any new reservations made before the end of the month,” Peter Rawlinson, Lucid’s CEO and CTO, said in the release. “Looking forward, we remain intently focused on ramping production and are excited about our product roadmap in 2022 and beyond with Air Grand Touring Performance deliveries expected in June; Air Touring and Air Pure later this year; and with our Project Gravity SUV remaining on target to begin production in the first half of 2024.”

The company said that as of June 1, new reservations will be priced in the U.S. at $154,000 for the Air Grand Touring, $107,400 for the Air Touring and $87,400 for the Air Pure. The price for the new Lucid Air Grand Touring Performance model, announced just two weeks ago, will remain priced in the U.S. at $179,000.

Lucid Signs Deal With Saudi Arabia, Selling Up To 100,000 EVs

In addition to the 30,000 customer reservations, Lucid said it recently signed a deal in which the government of Saudi Arabia committed to purchase up to 100,000 electric vehicles from Lucid over the next 10 years.

Sherry House, Lucid’s CFO, said in the release that similar to many companies in the industry, “we continue to face global supply chain and logistics challenges, including Covid-related factory shutdowns in China. We are working closely with our suppliers to mitigate the impact of disruptions.”

She added that while any extended disruptions could result in an impact to the production forecast, the company was reiterating its 12,000- to 14,000-vehicle production forecast for 2022.

“We continue to have a healthy balance sheet, closing the quarter with nearly $5.4 billion of cash on hand, which we believe is sufficient to fund the company well into 2023,” she said.

Investors May Want to Hold Lucid

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Nelson said that “Lucid’s quarterly cash burn totaled $870 million, leaving it with $5.39 billion of cash at the end of Q1, which LCID said is expected to fund the company well into 2023.”

“We continue to view a Hold opinion as warranted, with positives such as the quality of the Lucid Air, Saudi Arabian support (a deal to buy up to 100K vehicles over the next decade), and new factory in Arizona balanced by challenges in terms of achieving significant sales volumes given its vehicle pricing and a likely future capital raise,” he added.