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An Excavator Outside a Lucid Motors Plant in Arizona
A Lucid Motors factory in Arizona © Bloomberg

Tesla rival Lucid Motors on Wednesday cut its production target for 2022 in half, citing “extraordinary supply chain” challenges as it tries to ramp up production and meet “strong demand”.

The California-based group, backed by Saudi Arabia’s sovereign wealth fund, said production is now estimated to be between 6,000 and 7,000 cars by 2022, down from an earlier forecast of 12,000 to 14,000, which was down from a forecast. for the beginning of the year of 20,000 vehicles.

Shares of the electric car maker have already fallen 50 percent this year, reflecting the numerous challenges in scaling production of its Lucid Air – a luxury electric car that starts at $89,000 and was named MotorTrend’s Car of the Year for 2022. Shares fell another 12 percent outside office hours on Wednesday.

“We have identified key bottlenecks and are taking appropriate action, bringing our logistics operations in-house, adding key employees to the executive team and restructuring our logistics and manufacturing organization,” said CEO Peter Rawlinson.

“We continue to see strong demand for our vehicles, with over 37,000 customer reservations, and I remain confident that we will overcome these challenges in the near term.”

The 37,000 reservations total $3.5 billion in potential sales, the company said, but Lucid reported only $97.3 million in revenue in the June quarter, well below estimates of $147 million as it sold only 679 cars. delivered over the three-month period.

Lucid CFO Sherry House said the company has $4.6 billion in cash, “which we believe is enough to fund the company well into 2023.”

Despite recent stock market troubles, Lucid had a market cap of $34 billion at the time of its earnings on Tuesday, compared with $54 billion at GM and $60.4 billion at Ford, companies that routinely sell millions of vehicles a year.

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