Lucid Motors cuts prices
Getting involved in a price war might ne one way to solve the US EV pure play’s demand issues
California-headquartered Lucid has slashed the price of several of its Air sedan models, as it looks to solutions to the demand problems for the company’s luxury EV offerings.
The company is currently struggling to match demand for its products to the pace at which they are being manufactured. There will be hopes that a price cut, following in the footsteps of fellow US OEM Tesla, will provide a boost in sales.
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Analysts have already expressed worries about Lucid’s lack of sales relative to how many cars it is making. “Lucid has what we call a conversion ratio — meaning the number of vehicles it delivers as a percentage of the vehicles that it produces — about 60/62/63pc; that is nowhere near where it should be,” says Andres Sheppard, lead equity research analyst at US financial services firm Cantor Fitzgerald.
The question is whether the price cuts are going to be enough. Peer Fisker at the end of last week unveiled two new models it plans to sell under $40,000, which “will allow us to grab a huge part of whatever market we go in, because we do not see a lot of competitors for any of these vehicles”, predicted the firm’s CEO Henrik Fisker.
Even after price cuts, Lucid’s offerings hardly look cheap in a more crowded segment of the market. The base model Air Pure AWD will now sell for $82.400, a reduction of $5.000. The Air Touring is reduced by $12.400 to $95.000, while the Air Grand Touring now come down to $125.600 from $139.000.
There is “a sense of Lucid having some demand problems for their vehicles and I think a big reason for that is because their vehicles are very expensive”, Sheppard warned prior to the price cuts. It remains to be seen if the extent of the reductions can go much way to solving that problem.