Luxury electric vehicle maker Lucid (LCID) slashed prices of its sole product, the Air sedan, ahead of an important earnings release tonight.
In announcing its “Pure Summer Event,” Lucid cut the manufacturers suggested retail price (MSRP) of its base model Air Pure sedan by $5,000, bringing the starting price to $82,400 from $87,400. Lucid also cut prices of the higher trim Air Touring and Grand Touring each by $12,000, to $95,000 and $125,600, respectively.
Lucid said the special pricing would remain “while supplies last” and is available on cars for immediate delivery. Lucid also unveiled special lease and financing offers which are valid through the end of August.
Many EV makers have been cutting prices and availing themselves of the federal EV tax credit of $7,500 when applicable as a way to gin up demand and boost sales. Lucid however builds cars that are priced significantly higher than the $55,000 price cap for the EV tax credit; however the company is able to use the commercial lease exemption to reduce the price of its cars by the full $7,500 if customers opt to lease instead. Lucid lease customers also do not need to meet the federal tax credit’s strict income requirements.
Lucid’s steep price cuts come ahead of the company’s release of its second quarter financial report, slated for after the bell on Monday. Lucid is expected to report top-line revenue of $176.63 million and an adjusted EPS loss of $0.34. That revenue figure represents an 82% jump from a year ago when it reported $97.3 million in sales. Lucid is also expected to report an adjusted EBITDA loss of $596.14 million, versus the $414.1 million it lost a year ago.
From a deliveries standpoint, last month Lucid said it delivered 1,404 vehicles, missing Wall Street’s estimate of 1,873, and produced 2,173 vehicles in the quarter. In Q1 of this year, Lucid delivered 1,406 cars and produced 2,314, meaning the company didn’t match the prior period’s output. Lucid has said it was on track to produce 10,000 EVs in 2023.
Lucid’s price cuts here could be a sign of slowing demand, as evidenced by the Q2 deliveries miss.
Also in Q2, Lucid said it began “material shipments” of its EVs to Saudi Arabia, with which the company has a deal to deliver 100,000 EVs to the kingdom for use by the government. In addition, earlier in June Saudi Arabia’s Public Investment Fund, which owns over 60% of the company, agreed to buy 265.7 million additional shares of Lucid worth $1.8 billion. Lucid intends to build a factory in the kingdom with a planned annual capacity of 155K EVs a year.
In late June, Lucid announced a a “long-term strategic technology partnership” with British luxury automaker Aston Martin (ARGGY), which will use Lucid supply components and systems to power future Aston Martin EVs. Lucid shares jumped on the news of the licensing deal, however shares are currently trading near 6-week lows in midday trading.
Pras Subramanian is a reporter for Yahoo Finance. You can follow him on Twitter and on Instagram.
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