Crippled Lucid Buried by Competition

By Douglas A. McIntyre Published Jun 6, 7:10AM EDT

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Crippled Lucid Buried by Competition — © Justin Sullivan / Getty Images News via Getty Images

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The outlook for electric vehicle makers remains uncertain.
Lucid Group Inc. (NASDAQ: LCID | LCID Price Prediction) in particular faces nearly insurmountable problems.

Lucid Group Inc. (NASDAQ: LCID), the penny stock electric vehicle (EV) maker, has been in trouble for over two years. Its stock is down 80% over that period. And the competition is getting worse in a sector with slowing sales.

In the past several months, many EV companies have retreated in large capital expenditures. Yet, Ford posted double-digit percentage increases in EV sales in May, compared to the same month a year ago. Kia and Hyundai are attacking the market as if EV sales overall were surging. InsideEV recently ran a headline: “‘Foot on the Accelerator’: Hyundai and Kia’s EV Push Pays Off as Rivals Back Down.”

BMW and Mercedes continue to extend their lines of luxury EVs, with plans to hamper sales of high-end Teslas. South Korea’s Genesis has done the same.

And then there is Tesla Inc. (NASDAQ: TSLA), still the leader in U.S. EV sales, with about 50% of the market last year.

Lucid has three problems. It is too small. It needs more money. And, at about $80,000, its cars are way too expensive.

In the most recent quarter, Lucid’s revenue was $172 million, barely above the $149 million it had been the year before. It lost $680 million, compared to the year-ago loss of $780 million. It is hard to see how the company could manage to dig itself out of that hole.

Why would anyone own Lucid stock? They shouldn’t.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.