Today's

top partner

for CFD

Lucid Group (NASDAQ: LCID) is about to start taking orders for its second electric vehicle (EV) model and it might not be a stretch to say the company’s entire future is at stake. Customer orders for the Lucid Gravity SUV open next week on Nov. 7.

After hearing what Lucid CEO Peter Rawlinson just said in an interview with CNBC, though, investors may think the new EV won’t live up to expectations. That’s helped lead to a nearly 5% drop in Lucid shares today. As of 2:35 p.m. ET, Lucid stock was still lower by 2.5%.

Another almost $100,000 EV

Thus far Lucid has only been selling different trims of its luxury Air electric sedan. It has remained low volume as the price range begins at about $70,000 and goes up to $250,000. Lucid needs sales volumes to increase substantially to have any chance at long-term success. Rawlinson told CNBC that he’s confident that demand will increase meaningfully with the Gravity’s launch. He stated, “We believe there’s about a 6-to-1 ratio … for the SUV over sedan [demand], and that’s going to put us in a very strong position.”

Investors will only boost Lucid’s stock if it does see a dramatic increase in sales. Except the company said its first Gravity model available will be the Grand Touring trim, with pricing starting at $94,900. It won’t be until the end of 2025 that Lucid begins offering a lower priced trim starting at under $80,000.

To expect demand will be 6 times larger for its new SUV seems extremely optimistic. Even the followup model beginning production late next year may not have mass market appeal.

That might not be as big of an issue for investors if it weren’t for the current status of Lucid’s business. It only expects to produce about 9,000 vehicles this year after delivering 7,142 through September. Investors won’t likely give the company credit for a big volume boost until it sees actual demand at those levels. Until then, the stock may not move higher.

Should you invest $1,000 in Lucid Group right now?

Before you buy stock in Lucid Group, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Lucid Group wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $865,595!*

Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*.

See the 10 stocks »

*Stock Advisor returns as of October 28, 2024

Howard Smith has positions in Lucid Group. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Read the full story: Read More“>

Blog powered by G6

Disclaimer! A guest author has made this post. G6 has not checked the post. its content and attachments and under no circumstances will G6 be held responsible or liable in any way for any claims, damages, losses, expenses, costs or liabilities whatsoever (including, without limitation, any direct or indirect damages for loss of profits, business interruption or loss of information) resulting or arising directly or indirectly from your use of or inability to use this website or any websites linked to it, or from your reliance on the information and material on this website, even if the G6 has been advised of the possibility of such damages in advance.

For any inquiries, please contact [email protected]