All discussion of Lucid Motors

[RobStark]

Peter says they don't have a production problem.

Then listed parts problems they have. Implying they still have supplier issues, just not problems inside Lucid factory.

He also said they have brand awareness problem. He said he thinks they are on the verge of a critical mass of cars. And he means in markets for premium cars. Like Los Angeles and Miami not Fort Wayne, Indiana. Once you reach a "critical mass" your car becomes a consideration for most buyers.

 

[MP3Mike]

Peter says they don't have a production problem.

Then listed parts problems they have. Implying they still have supplier issues, just not problems inside Lucid factory.

He also said they have brand awareness problem. He said he thinks they are on the verge of a critical mass of cars. And he means in markets for premium cars. Like Los Angeles and Miami not Fort Wayne, Indiana. Once you reach a "critical mass" your car becomes a consideration for most buyers.

Which is what we have been saying, and you have been disagreeing with.

They have a sales problem. Even with ~28k reservations they don't currently have enough willing buyers right now, at least for the cars that they have made. (And can make with parts available to them.)

In Q4 they sold less than 2k vehicles, but net reservations dropped by ~6k. Again, demonstrating a demand problem. (Or that a lot of those reservations were/are not for actual buyers.)

Maybe they will sell better in Europe, but given how much people insist that Teslas are too big, I doubt it.

 

[bkp_duke]

Which is what we have been saying, and you have been disagreeing with.

They have a sales problem. Even with ~28k reservations they don't currently have enough willing buyers right now, at least for the cars that they have made. (And can make with parts available to them.)

In Q4 they sold less than 2k vehicles, but net reservations dropped by ~6k. Again, demonstrating a demand problem. (Or that a lot of those reservations were/are not for actual buyers.)

Maybe they will sell better in Europe, but given how much people insist that Teslas are too big, I doubt it.

I am of the opinion that their sales problem is mainly a pricing problem.

Who is going to pay 150-180k for a Lucid Air Grand Touring when a Model S Plaid is about 30-65k cheaper, and far faster. Sure, there are other differences, the Lucid's interior is much nicer, but the Tesla has an infinitely better charging network.

Best possible thing for Lucid would be a price cut. Even 10k would generate a lot more interest in the car.

 

[Electroman]

I am of the opinion that their sales problem is mainly a pricing problem.

Their sales problem is a combination of pricing problem and a charging problem, atleast for now until reliable CCS chargers become more ubiquitous and Tesla opens up more of their SCs

 

[MP3Mike]

Nope, no problems at Lucid:

According to drone fly over, Lucid have paused production most likely due to too much inventory on their lot. According to their earnings report, they have over 800M dollars worth of inventory, which supersede their quarterly revenue by almost 3X.

 

[JimmyB]

I have less than a week to confirm my Lucid order, if I want it, at the old pricing. So I went and test-drove one yesterday. It's an incredible car. Smooth, sure-footed, and the interior is very impressive indeed.

There's also currently $7,500 off the Touring and above, so combined with the pre-increase pricing I could get one at around $20k under current list price. It's tempting. But, much as I want one, I'm going to stick with my Model S for a while, until Lucid's future - and the non-Tesla charging ecosystem - are a little more certain.

 

[Singuy]

I have less than a week to confirm my Lucid order, if I want it, at the old pricing. So I went and test-drove one yesterday. It's an incredible car. Smooth, sure-footed, and the interior is very impressive indeed.

There's also currently $7,500 off the Touring and above, so combined with the pre-increase pricing I could get one at around $20k under current list price. It's tempting. But, much as I want one, I'm going to stick with my Model S for a while, until Lucid's future - and the non-Tesla charging ecosystem - are a little more certain.

This is currently the negative feedback loop Lucid and all of these start ups are afraid of. And also what Tesla was afraid of back in 2019 when "bankruptcy" headlines were plastered all over MSM killing demand.

 

[DBV1]

I have less than a week to confirm my Lucid order, if I want it, at the old pricing. So I went and test-drove one yesterday. It's an incredible car. Smooth, sure-footed, and the interior is very impressive indeed.

There's also currently $7,500 off the Touring and above, so combined with the pre-increase pricing I could get one at around $20k under current list price. It's tempting. But, much as I want one, I'm going to stick with my Model S for a while, until Lucid's future - and the non-Tesla charging ecosystem - are a little more certain.

That is the exact situation I am in too. And feel like you do, although still undecided if I will move forward or keep my refresh Model S.

I think Lucid will have to lower pricing, since Tesla just did it for their Model S to stay competitive. It sure is enticing though with the old pricing and the $7500 off.

It really is an awesome car and looks so futuristic, at least to me.

 

[Electroman]

Lucid is turning heads and winning praise, unlike Fisker which was a disaster specifically its software and UI.

Now if they can lower the price and sign up for Tesla supercharging infrastructure.. they will survive.

 

[Singuy]

Lucid is turning heads and winning praise, unlike Fisker which was a disaster specifically its software and UI.

Now if they can lower the price and sign up for Tesla supercharging infrastructure.. they will survive.

Lucid will survive if they

-redesign their car, take out all the exotic hard to manufacture materials out
-redesign the manufacturing line
-cut 40% of their staff
-injection of at least 10 billion dollars
-change the corporate culture asap. Instead of bla bla bla our technology, they need to focus on cost cutting day and night. Lock their engineers in a room until they can figure it out if they need to. They need to figure out how to break even on gross profit @ 5000 deliveries or less.

Currently there's a 99.9% chance the company is going under/saudi buy out pennies on the dollar. I really don't see much of a way out as a business. I have no problem with their cars. I think it's a fine vehicle but the business is heading straight to bankruptcy.

 

[MP3Mike]

Now if they can lower the price and sign up for Tesla supercharging infrastructure.. they will survive.

I don't see how signing upe for Tesla Supercharging will help. Their "Wünderbox" will only charge at ~50kW from a Supercharger. Charging as slow as a Chevy Bolt certainly isn't going to win a lot of buyers.

Now if they redesigned the "Wünderbox" to support ~250kW charging at Tesla Superchargers that might help. But that would make it cost more, not less.

 

[GSP]

Lucid will survive if they

-redesign their car, take out all the exotic hard to manufacture materials out
-redesign the manufacturing line
-cut 40% of their staff
-injection of at least 10 billion dollars
-change the corporate culture asap. Instead of bla bla bla our technology, they need to focus on cost cutting day and night. Lock their engineers in a room until they can figure it out if they need to. They need to figure out how to break even on gross profit @ 5000 deliveries or less.

Currently there's a 99.9% chance the company is going under/saudi buy out pennies on the dollar. I really don't see much of a way out as a business. I have no problem with their cars. I think it's a fine vehicle but the business is heading straight to bankruptcy.

This is the sort of change needed, IMO. However IDK about profitable business selling 5000 cars. Ferrari and Rolls-Royce struggled to remain profitable at similar volumes, but succumbed in the end and were bought by high volume automakers.

When Model S production started, Elon said “Tesla could be profitable at 20,000 units/year, perhaps 10,000.” That was if they consolidated on Model S only and did not invest in a high volume mid-priced car. In reality, it took volume production of 250,000 units/year or more of the Model 3 before Tesla achieved sustained profitability.

GSP

 

[Singuy]

This is the sort of change needed, IMO. However IDK about profitable business selling 5000 cars. Ferrari and Rolls-Royce struggled to remain profitable at similar volumes, but succumbed in the end and were bought by high volume automakers.

When Model S production started, Elon said “Tesla could be profitable at 20,000 units/year, perhaps 10,000.” That was if they consolidated on Model S only and did not invest in a high volume mid-priced car. In reality, it took volume production of 250,000 units/year or more of the Model 3 before Tesla achieved sustained profitability.

GSP

You are mixing up "profitability" with gross profit. Lucid hitting a positive gross profit is still miles away from profitability, but at least every car that is sold doesn't burn as much as today. Gross profit is just cost of goods sold is lower than what you are charging for the car. This doesn't include all the capex and operating expense a company has to overcome to be actually profitable.

Tesla's model S had a positive gross margin after delivering just 400 cars. They were still far from being profitable. It took them 1 year after that to break even, but almost a decade just to be profitable consistently.

 

[Doggydogworld]

Gross profit is just cost of goods sold is lower than what you are charging for the car. This doesn't include all the capex and ....

Gross margin does include the cost of manufacturing capex. It's just spread out over multiple years of production in the form of depreciation.

It's contribution margin that excludes capex/depreciation.

 

[GSP]

You are mixing up "profitability" with gross profit. Lucid hitting a positive gross profit is still miles away from profitability, but at least every car that is sold doesn't burn as much as today. Gross profit is just cost of goods sold is lower than what you are charging for the car. This doesn't include all the capex and operating expense a company has to overcome to be actually profitable.

Tesla's model S had a positive gross margin after delivering just 400 cars. They were still far from being profitable. It took them 1 year after that to break even, but almost a decade just to be profitable consistently.

Not exactly. Yes the Model S generated a gross profit almost from SOP, but Elon’s statement was he could make the company profitable if they could reach 20,000 units/year. That was just a fallback plan though, as Elon also made it clear they were going to invest to make the “affordable” car instead.

No auto startup, Lucid included, will survive if they only make a gross profit. At some point, the company will have to be profitable to pay all of their expenses. So, my point stands that 5000 units/year is not enough. Not enough for Tesla, not enough for Ferrari, not enough for Rolls, and not enough for Lucid.

GSP

 

[Singuy]

Not exactly. Yes the Model S generated a gross profit almost from SOP, but Elon’s statement was he could make the company profitable if they could reach 20,000 units/year. That was just a fallback plan though, as Elon also made it clear they were going to invest to make the “affordable” car instead.

No auto startup, Lucid included, will survive if they only make a gross profit. At some point, the company will have to be profitable to pay all of their expenses. So, my point stands that 5000 units/year is not enough. Not enough for Tesla, not enough for Ferrari, not enough for Rolls, and not enough for Lucid.

GSP

So far from all the companies producing cars in some kind of volume, Lucid and Rivian are the only two with a negative gross profit. We are not talking about a small negative gross margin here, but over 100%. Xpeng, Nio, Polestar, and BYD are all in the green when it comes to gross profit.

 

[GSP]

So far from all the companies producing cars in some kind of volume, Lucid and Rivian are the only two with a negative gross profit. We are not talking about a small negative gross margin here, but over 100%. Xpeng, Nio, Polestar, and BYD are all in the green when it comes to gross profit.

Good for the others, but Lucid and Rivian are in big trouble if they don’t fix their negative gross profit quickly. That goes without saying of course. Again my point is that even with a heathy gross profit, Ferrari and Rolls could not cover their expenses with about 5000 cars/year. It was enough back in the day, but the cost of doing business was lower then. Now days expenses are higher, and maybe COGS of zero would not be low enough at only 5000 cars/year.

GSP

 

[Singuy]

Good for the others, but Lucid and Rivian are in big trouble if they don’t fix their negative gross profit quickly. That goes without saying of course. Again my point is that even with a heathy gross profit, Ferrari and Rolls could not cover their expenses with about 5000 cars/year. It was enough back in the day, but the cost of doing business was lower then. Now days expenses are higher, and maybe COGS of zero would not be low enough at only 5000 cars/year.

GSP

My initial statement is that they have to figure out how to make a GROSS PROFIT at 5k/year or less. I was not referring to these companies making a net profit at 5k/year. Tesla did it with 400 cars delivered in a quarter. Most company hit a gross profit by then

 

[GSP]

My initial statement is that they have to figure out how to make a GROSS PROFIT at 5k/year or less. I was not referring to these companies making a net profit at 5k/year. Tesla did it with 400 cars delivered in a quarter. Most company hit a gross profit by then

That would be nice, but it would still not be enough to survive. Lucid (and Rivian) will have to do more than that.

 

[Singuy]

That would be nice, but it would still not be enough to survive.

That's where another 10B injection of cash comes in. Getting gross profit, especially Rivian, will cut their cash burn by over 50%. This is significant and gives them a chance better than 0% right now.