Lucid’s shares fell as it cut production target in half

New York
CNN Business

Shares of luxury electric car maker Lucid fell more than 10% Thursday after the company revealed that it will build nearly half of the cars this year it planned to build.

The company said it was dealing with serious supply chain problems that have disrupted production for other automakers as well. But supply chain problems sometimes brought production to a halt completely during the quarter, as well as slashing the production target to 6,000 to 7,000 vehicles this year, down from its previously announced target of 12,000 to 14,000 vehicles.

The company said that it was able to ship 1,400 cars during the first half of this year. It said that during the quarter just completed, it halted shipments of a “significant number” of vehicles “to ensure that these vehicles meet the highest quality standards.”

“Quality as a luxury brand should take priority over size,” Lucid CEO Peter Rawlinson said on a call with investors Wednesday afternoon.

While other automakers have already temporarily shut down production lines due to chip shortages, they have often kept factories running by removing features such as heated seats.

Overall, Lucid reported an adjusted net loss of $555.3 million, which was better than the $619 million loss forecast by analysts surveyed by Refinitiv, and better than the $604.6 million loss in the first quarter. Revenue was $97.3 million. She said that the number of orders she received for her cars rose to 37,000 from 30,000 backlogged orders at the end of last year.

Lucid cars have had some major accolades, with Lucid Air winning MotorTrend Car of the Year last year. The Dream version of that car can cover 520 miles in the industry on a single charge.

But Lucid (LCDX) shares have already fallen 46% so far this year to Wednesday’s close, with only a drop on Thursday adding to the decline.

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