Lucid dismisses report it was weighing bankruptcy after shares plunge
A Lucid Air electric vehicle (EV) at the company’s showroom on Saturday, February 17, 2024 in Tysons, Virginia, United States.
Samuel Corum | Bloomberg | Getty Images
Lucid Engine The stock fell more than 40% at one point, and trading was halted multiple times Tuesday amid volatility amid speculation the company was considering new options.
A site focused on electric vehicles called EVs reported Tuesday Lucid was considering going private or filing for Chapter 11 bankruptcy protection. According to the site, the company asked AlixPartners to review these options and present its findings to Lucid’s board of directors before the next meeting.
EV’s report also noted that AlixPartners encouraged its board to pursue further restructuring in the US and Europe and focus on the Gravity SUV.
AlixPartners said it had no comment on the report. Lucid said in a statement that “the rumors are completely false.”
“The Company has sufficient liquidity to carry its operations into next year, as recently published in its latest quarterly filings, and has not established any special Board committees to investigate the scenarios reported today,” the company said in a statement. “Our focus is on improving execution, strengthening operations, and positioning Lucid to realize the full potential of its technology, products, and innovation. AlixPartners is assisting us with this and nothing else, and has not recommended bankruptcy to management or the Board of Directors.”
Lucid faces an increasingly challenging market due to slower-than-expected adoption of electric vehicles and changing regulations under the Trump administration. Including eliminating the $7,500 federal incentive for purchasing electric vehicles.
The electric vehicle maker, which is heavily backed by Saudi Arabia’s Public Investment Fund, announced last month that it would lay off 18% of its workforce in the United States as part of a cost-saving plan.
Earlier this month, Lucid missed Wall Street’s expectations for second-quarter delivery results.
The company’s new CEO, Silvio Napoli, announced changes to the company’s leadership team at that time in order to “simplify the company’s structure.”
Lucid suspended production guidance in May after Naples said the company would evaluate business decisions and needed to reduce its “high inventory” of vehicles.
