One of the single largest EV orders ever arrives just in time, and from Lucid’s main backer.
- Lucid receives purchase commitment from Saudi Arabia’s Ministry of Finance for 50,000 EVs, with an option to purchase 50,000 more in a ten-year time span.
- Saudi Arabia’s Public Investment Fund (PIF) holds a 61% stake in Lucid, with the automaker planning to build its second factory in the kingdom in the near future.
- Lucid recently revised its 2022 production forecast downward from 20,000 sedans to a range between 12,000 and 14,000, citing supply-chain pressures.
Lucid’s relationship with Saudi Arabia’s Public Investment Fund (PIF), which owns 61% of the automaker, has not been the main topic of conversation regarding the start-up, which began deliveries of its long-awaited Lucid Air luxury sedan just months ago. But it’s bound to get more attention in the near future, as Saudi Arabia’s Ministry of Finance has just made a purchase commitment for 50,000 Lucid vehicles, including the Air sedan and future Lucid models, with an option to buy another 50,000 over the course of ten years.
It’s safe to say this is the single largest order for Lucid models to date, and is bound to give the automaker a serious boost in a number of areas, including stock value.
Lucid has been delivering the Air sedan for a relatively short period of time but has recently revised its 2022 production outlook downward, slashing it from 20,000 sedans down to a range between 12,000 and 14,000 vehicles, citing the chip shortage and other component-related pressures.
If there is one other thing that’s clear from this order, it’s that Saudi Arabia’s Ministry of Finance buys a lot of cars each year. But does Lucid have the spare capacity at the moment to boost its output upward?
“The order quantity is expected to range from 1,000 to 2,000 vehicles annually and increase to between 4,000 and 7,000 vehicles annually starting in 2025, with the delivery of the vehicles required to commence no later than the second quarter of 2023,” the automaker says.
The vehicles will be built at Lucid’s Arizona plant and also at a future factory that Lucid plans to build in Saudi Arabia.
Lucid launched production of the Air sedan in late 2021.
Lucid
Saudi Arabia’s order will certainly boost the automaker’s number of reservations, which was reported to be over 25,000 units a couple of months ago.
Another way of looking at this order for up to 100,000 vehicles is that Saudi Arabia’s PIF is dramatically boosting Lucid’s order numbers in a non-organic manner, as opposed to private buyers placing these orders because they actually want a Lucid Air instead of other vehicles on the EV market. But this wouldn’t be an industry first, as large stakeholders of EV start-ups like Amazon had also announced large orders from Rivian over an extended period of time.
However, it’s worth noting Lucid’s stock had dropped quite a bit since its late 2021 highs—down almost 70% in fact—believed to be tied to a slower-than-expected production pace and was certainly not helped by its projected 2022 output being cut by up to 40%, amid industry worries over raw materials and other components. Quite a lot still rides on Lucid’s ability to introduce other electric models, ones that don’t cost over $100,000, given the meager annual sales figures for large sedans with gas or electric powertrains.
“Delivering up to 100,000 Lucid electric vehicles in Saudi Arabia represents another pivotal moment in our acceleration of sustainable transportation worldwide,” said Peter Rawlinson, Lucid’s CEO and CTO. “We are delighted to be supporting Saudi Arabia in achieving its sustainability goals and net zero ambitions, as outlined by Saudi Vision 2030 and the Saudi Green Initiative, by bringing our advanced luxury EVs to Saudi Arabia.”
Keyword: Lucid Will Build up to 100,000 EVs for Saudi Government