Should you ask Lucid (Lucid) CEO Peter Rawlinson, the corporate is the “most immune” EV maker if President-elect Donald Trump cuts the federal tax credit score for electrical vehicles. Regardless of the declare, Lucid’s inventory is hitting a brand new all-time low at beneath $2 a share.
Is Lucid proof against dropping the EV tax credit score?
Lucid is coming off its third straight document quarter of deliveries. With one other 2,781 autos offered in Q3, Lucid’s supply whole reached 7,142 via the primary 9 months of 2024, already topping the 6,001 deliveries in 2023.
Nevertheless, share costs are sinking following a Reuters report on Thursday that Trump’s transition group is “planning to kill” the federal EV tax credit score, which gives as much as $7,500 for clear automobile consumers.
The report additionally cited two sources claiming that representatives from Tesla (TSLA) informed Trump’s group that they supported the plans to finish the subsidy.
CEO Elon Musk, who absolutely endorsed Trump, mentioned dropping the credit score might barely affect Tesla’s gross sales however can be “devastating” to others within the US.
Though its luxurious Air sedan, beginning at $69,900, doesn’t qualify for the $7,500 credit score, Lucid is passing it on to some via leasing. Nevertheless, Rawlinson mentioned a lot of its shoppers make greater than the $150,000 for single filers and $300,000 threshold for {couples} submitting collectively.
Due to that, even when Trump cuts the EV tax credit score, Lucid’s CEO believes it’s in a stronger place than many of the competitors.
When requested about Trump’s plans, Rawlinson mentioned on Bloomberg Tv on Friday that “Lucid, amongst all of the EV makers, is basically probably the most immune from that.”
Lucid’s CEO additionally mentioned he isn’t apprehensive about Musk getting favorable remedy when Trump takes workplace. Rawlinson defined:
We’ve actually taken the mantle of know-how management from Tesla proper now, and this isn’t actually sufficiently acknowledged. So, I feel we’re in a really sturdy place to climate any such storm.
Lucid opened orders for its first electrical SUV earlier this month. Beginning at $79,800, the Lucid Gravity is predicted to get a powerful vary of 440 miles per cost.
Rawlinson calls the Gravity a “landmark product” with its most superior know-how but, which he claims is “years forward of the competitors.” Final month, we bought our first look at its lower-priced midsize electrical SUV. Costs for the brand new mannequin will begin at beneath $50,000.
Will probably be the primary of at the least three midsize Lucid EVs, with manufacturing anticipated to start in late 2026. Rawlinson mentioned the midsize fashions are aimed “proper within the coronary heart of Tesla Mannequin 3, Mannequin Y territory.”
Regardless of the boldness, Lucid’s inventory hit its lowest value on Friday since going public in July 2021. Lucid shares are down practically 17% this week, sitting at beneath $2 per share.
Electrek’s Take
Ending the federal tax credit score will put your entire US auto trade behind. China continues to realize extra world market share as leaders like BYD broaden into key abroad markets like Europe, Southeast Asia, and Central and South America.
In reality, in response to Bloomberg, BYD is shortly closing in on Ford in world deliveries and will even high the American automaker by the tip of 2024.
BYD’s surging world presence is primarily attributable to its early beginnings as a battery maker. Nevertheless, China’s authorities can also be fueling EV gross sales progress with subsidies for those who commerce in gas-powered autos.
Based on Rho Movement, China continues dominating the worldwide market with a document 1.2 million EVs offered in October alone. China has now offered 8.4 million EVs in 2024, up 38% year-over-year (YOY), in comparison with 1.4 million within the US (+9% YOY).
Rawlinson could also be proper. Lucid may very well be some of the immune if the tax credit have been minimize. Nevertheless, different US automakers, like Ford, GM, and Jeep-maker Stellantis, will not be as fortunate.
So, what occurs if the subsidies are killed off? American automakers will seemingly delay or cancel extra EV initiatives (new fashions, battery vegetation, manufacturing services), which is able to ship them additional behind within the world market.
Ford’s CEO Jim Farley warned rivals earlier this 12 months, saying if they can not sustain with the Chinese language, “then 20% to 30% of your income is in danger.” He added, “Because the CEO of an organization that had hassle competing with the Japanese and the South Koreans, we’ve got to repair this drawback.” Ending subsidies would solely put them additional behind.
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