Tourbillon
Cornering Kingpin
I remember reading about a Volkswagen with more but we'll have to await independent testing.
Lucid Group, Inc. is an American manufacturer of electric luxury sports cars and grand tourers headquartered in Newark, California. Lucid vehicles are designed in California and manufactured at Lucid's factory in Arizona. The company was founded in 2007. Since April 2019, Lucid has been majority-owned by Public Investment Fund, the sovereign wealth fund of Saudi Arabia.
I remember reading about a Volkswagen with more but we'll have to await independent testing.
Tourbillon
Cornering Kingpin
EV maker Lucid to raise $3 billion, mainly from Saudi's PIF!
www.reuters.com
"May 31 (Reuters) - Lucid Group (LCID.O) said it plans to raise about $3 billion through a stock offering, nearly two-thirds of which will come from Saudi Arabia's Public Investment Fund (PIF), sending shares of the luxury electric-vehicle maker down 9% after market hours.
PIF, which owns more than 60% of the company, has agreed to buy 265.7 million shares in a private placement for about $1.8 billion, Lucid said, implying a price of about $6.80 per Lucid share, compared with the stock's Wednesday close of $7.76.
The remainder will be raised from a public offering of 173.5 million shares of common stock.
The additional funds are critical and come as the automaker, like its peers, struggles with mounting losses and tightening cash reserves amid recession fears and a price war sparked by market leader Tesla Inc (TSLA.O).
"The secondary offering will probably be ok as there's a lot of ESG dollars looking for investments," said Louis Navellier, chief investment officer at money management firm Navellier, which has made EV and related investments but has stayed away from Lucid.
"That, along with money from the Saudis, will ensure Lucid survives a couple of more years. But their burn rate needs to fall fast. There's a glut of EVs for sale in the U.S. and competitors are cutting prices and offering discounts," he said.
Lucid's cash and cash equivalents had dropped to $900 million at the end of the first quarter, from $1.74 billion in the previous quarter.
CFO Sherry House had said the company had about $4.1 billion in liquidity, enough to fund the EV maker at least into the second quarter of next year.
The maker of luxury Air sedans trimmed its 2023 production forecast this month and reported a lower-than-expected first-quarter revenue, with CEO Peter Rawlinson citing rising interest rates as a challenge to the market.
Despite Lucid's struggles, Saudi's PIF, led by Crown Prince Mohammed bin Salman, has been a loyal investor in the automaker with its stake currently worth nearly $9 billion.
The California-based EV maker is building its first overseas production factory in Saudi Arabia and the Saudi government has agreed to buy up to 100,000 Lucid vehicles over the next decade.
On Wednesday, Lucid, which is set to unveil its Gravity sport utility vehicle later this year ahead of its launch in 2024, said it plans to use the net proceeds from its offerings for general corporate purposes, including capital expenditure and working capital.
Bank of America Corp (BAC.N) is acting as the book-running manager for the public offering. The fundraising was first reported by Bloomberg News."
EV maker Lucid to raise $3 billion, mainly from Saudi's PIF
Lucid Group said it plans to raise about $3 billion through a stock offering, nearly two-thirds of which will come from Saudi Arabia's Public Investment Fund (PIF), sending shares of the luxury electric-vehicle maker down 9% after market hours.
www.reuters.com
"May 31 (Reuters) - Lucid Group (LCID.O) said it plans to raise about $3 billion through a stock offering, nearly two-thirds of which will come from Saudi Arabia's Public Investment Fund (PIF), sending shares of the luxury electric-vehicle maker down 9% after market hours.
PIF, which owns more than 60% of the company, has agreed to buy 265.7 million shares in a private placement for about $1.8 billion, Lucid said, implying a price of about $6.80 per Lucid share, compared with the stock's Wednesday close of $7.76.
The remainder will be raised from a public offering of 173.5 million shares of common stock.
The additional funds are critical and come as the automaker, like its peers, struggles with mounting losses and tightening cash reserves amid recession fears and a price war sparked by market leader Tesla Inc (TSLA.O).
"The secondary offering will probably be ok as there's a lot of ESG dollars looking for investments," said Louis Navellier, chief investment officer at money management firm Navellier, which has made EV and related investments but has stayed away from Lucid.
"That, along with money from the Saudis, will ensure Lucid survives a couple of more years. But their burn rate needs to fall fast. There's a glut of EVs for sale in the U.S. and competitors are cutting prices and offering discounts," he said.
Lucid's cash and cash equivalents had dropped to $900 million at the end of the first quarter, from $1.74 billion in the previous quarter.
CFO Sherry House had said the company had about $4.1 billion in liquidity, enough to fund the EV maker at least into the second quarter of next year.
The maker of luxury Air sedans trimmed its 2023 production forecast this month and reported a lower-than-expected first-quarter revenue, with CEO Peter Rawlinson citing rising interest rates as a challenge to the market.
Despite Lucid's struggles, Saudi's PIF, led by Crown Prince Mohammed bin Salman, has been a loyal investor in the automaker with its stake currently worth nearly $9 billion.
The California-based EV maker is building its first overseas production factory in Saudi Arabia and the Saudi government has agreed to buy up to 100,000 Lucid vehicles over the next decade.
On Wednesday, Lucid, which is set to unveil its Gravity sport utility vehicle later this year ahead of its launch in 2024, said it plans to use the net proceeds from its offerings for general corporate purposes, including capital expenditure and working capital.
Bank of America Corp (BAC.N) is acting as the book-running manager for the public offering. The fundraising was first reported by Bloomberg News."
Jonathan19
Premium+
Centurion
Apex Apex Predator
Bad news and damning news for EV start ups. I think Lucid will file for bankruptcy in 18-24 months. Let me break it down:
1. No new or existing investors joined Saudi Arabia's investment fund in this road. The tech world is in a liquidity crunch.
Furthermore Saudi PIF and Softbank have a tainted investment track record. their mentality has been "everything is going up" but recently many of their tech investments have been written down by 50-90%. Co-invest with them at your own peril. They have got billions to lose without breaking a sweat.
2. The cash burn in staggering at $500-600m per quarter. Raising $3b only extends their runway to 2024Q2. This is before expansion to the UK market, completion of Gravity SUV development and production start. In the next 12 months Lucid will need to raise $5-10b round.
3. Lucid's original sales pitch was Tesla but with S-Class luxury. However that pitch is dead as you can buy an EQS, i7 and their SUV equivalents. Unfortunately Lucid haven't been able to follow in the shadow of Tesla's first mover advantage.
Tourbillon
Cornering Kingpin
We will have to see. But Bankruptcies are an unfortunate part of Financial and Business life. I'd need to study this case more.
For some an unfortunate ending is the beginning of another. With unique technologies, production facilities as and factories and a million and one other things, whilst this may happen, someone else would pick up possibly the bargain of the Century.
4) They've not really shovelled enough absolute bullsh!t either, I mean they've not even promised their cars will generate the owner a gross profit of $30,000 per year as robo-taxis .... pffft... amateurs.
It could be like one of the many potholes that Tesla went through, 10 years suffering, 2 brilliant years that erased everything from before, Lucid will go through more surely, but they have Monday's newspaper, they know what can happen if they do the right things and of the start-ups it is the only one that is not China that it is fulfilling in part what is offered
Centurion
Apex Apex Predator
Which 2 manufacturers are most in desperate need of Lucids assets and IP, and why?
Centurion
Apex Apex Predator
Tesla had something that Lucid didn't:
-An insanely long 15-20 year financial runway.
-No competition. For years and almost a decade, the majority of EV funding went to Tesla.
-The business grew during a period of 0.5-1% interest rates. Credit was cheap and investors had to find other places than savings account to grow wealthier.
-Low inflation. Today everything in manufacturing is more expensive than 10 years ago.
To compete aggressively, Lucid will need $6-10b/year in cash. If the Saudi Arabian government doesn't participate in the next funding round then which major VC firm will?
Correct different environment, but you make it sound as if Tesla had it easy to retain and add investors, that was his Everest.
Centurion
Apex Apex Predator
As pioneers Tesla no doubt had huge headwinds. Musk likely had many sleep was night about convincing investors that Tesla and Space had probable paths to profit.
Tourbillon
Cornering Kingpin
Anyone currently courting them for partnerships. Aston Martin for one Mercedes Benz isn't giving them anything after the current ICE V8's and I believe this extends to hybrid technologies too. The synergistic relationship between their investors is also strong from memory.
Or they could just go back to being an OEM like they were before Lucid Group. Etc, needs alot of study. But last year after looking at McLaren's situation, I stopped.
kiki voinea
Stuttgart Specialist
I'd add :
4. Software has major issues. Is slow , full of bugs . Besides the fit&finish , but that could be understood in someway , given the fact that they are new to the market. But the software is an issue , because it looks like the hardware is under-powered.
5.The price is still a little too high , IMO. The cheaper version is not selling right now. And that's a bummer.
But your point is very good : Saudi+Softbank , major red flag....
Tourbillon
Cornering Kingpin
Tourbillon
Cornering Kingpin
This happened at a "demo" the Lucid Air is currently on a National trip with a series of these drive events in the United States of America.
Someone called it "demo~lition!".
Nothing to say it is what it is.
It seems that the national trip will only be local
Being a demo...can they reset it?
Does the Fruk also work as a barbecue?
Tourbillon
Cornering Kingpin
What I meant was on a National Series of arranged test drives and demonstrations and test drives for clients.
And as for the rest of it LOL!
Tourbillon
Cornering Kingpin
Unfortunately it's not the physical damage as much as the inevitable tongue wagging. It's not wholly unjustified, but damn, some places it's "hardcore."
So I just read a little and go, it's concerning though.
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