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When a company’s stock chart resembles a cliff dive, the immediate question is always the... When a company’s stock chart resembles a cliff dive, the immediate question is always the same: is this a catastrophe or a bargain? For Lucid Group, the luxury EV maker that once surfed the SPAC wave to a near-$60 stock price, the fall has been brutal. After a 1-for-10 reverse stock split just to keep its head above water, the stock now trades under $20. On a split-adjusted basis, it’s a loss of over 90% from its public debut.
Numbers like that don't just happen. They are the result of a profound disconnect between a company's narrative and its operational reality. Lucid’s initial story was compelling. It had Peter Rawlinson, a Tesla engineering veteran, at the helm. It had a sleek, award-winning sedan in the Lucid Air. And it had promises—big ones. The company projected 20,000 vehicle deliveries in 2022. The market priced it for perfection.
Then reality delivered the invoice.
A History Written in Missed Targets
The core of any manufacturing business is its ability to, well, manufacture. This is where the Lucid story begins to unravel. That 20,200-vehicle target for 2022? The final number was 4,369. The projection for 2023 was 49,000. They delivered 6,001. For 2024, they guided for 90,000 and delivered 10,241. These aren't minor misses or slight adjustments for supply chain hiccups. This is a pattern of systemic failure to scale.
The company has a laundry list of external excuses: supply chains, inflation, competition, reduced subsidies under the Trump administration. While these are all legitimate headwinds for the EV sector, they don't fully account for the magnitude of Lucid's underperformance. Tesla, for all its own issues, ramped up from around 22,000 vehicles in 2013 to nearly 1.8 million in 2024. It did so by brute-forcing its way through "production hell." Lucid, by comparison, seems permanently stuck in production purgatory.
And this is the part of the data that I find genuinely puzzling. The gross margin for the company is a staggering -9,926%. That isn't a typo. It suggests a fundamental, structural problem with the cost of building each vehicle that goes far beyond typical startup inefficiencies. They are losing an astronomical amount of money on every car that rolls off the line. Compounding this, Peter Rawlinson stepped down as CEO in February, leaving the company without a permanent leader during its most critical period. How can a company execute a complex turnaround without a captain steering the ship?
The bull case rests on a projected compound annual revenue growth of 82% through 2027. But this projection is built on the same sand that their previous delivery targets were: the assumption that they can suddenly learn to manufacture at scale. Past performance is no guarantee of future results, but in manufacturing, it’s a pretty strong indicator of core competency. Or a lack thereof.
Selling the Future to Pay for the Present
Facing a disastrous present, Lucid has done what any cash-burning, hype-driven company does: it has started selling the future. The narrative is shifting away from the simple, difficult business of building and selling cars and toward a more abstract, exciting vision of high technology.
First came the deal with Uber and Nuro to develop a fleet of 20,000 autonomous Gravity SUV robotaxis. It’s an interesting headline, but the timeline stretches over six years, and the first test vehicle was only delivered in September. It’s a promissory note, not a revenue stream.
The much bigger announcement is that Lucid partners Nvidia for mid size Level 4 EVs. The company plans to integrate Nvidia's Drive AV platform into its vehicles, targeting Level 4 "eyes-off, hands-off" autonomy. This is a massive technological undertaking, involving a multi-sensor architecture and dual Drive AGX Thor computers in each vehicle. It’s a bold, ambitious plan to leapfrog competitors in the autonomous driving race.
This move is like a brilliant architect designing a futuristic skyscraper while the foundation of their first bungalow is cracking. The Nvidia partnership is technically impressive, but it does absolutely nothing to solve Lucid’s core problem: it can’t build cars efficiently. In fact, it complicates it by adding layers of advanced, expensive hardware and software that will need to be integrated into a manufacturing process that is already broken. Is this a genuine strategic pivot or a sophisticated distraction to keep investors, particularly the Saudi Public Investment Fund (which owns over 60% of the company), captivated by the promise of tomorrow?
The company still has a decent amount of liquidity—$4.86 billion at last count—thanks almost entirely to the backing of the PIF. This financial lifeline allows them to continue burning billions (they lost about $3.1 billion in 2024—to be more exact, $3.06 billion) while chasing these high-tech dreams. But it transforms Lucid from a traditional automaker into something else entirely. It's less a public company accountable to the market and more of a state-funded R&D project with a stock ticker attached.
A Speculative Tech Stock, Not an Automaker
Let's be clear about what an investment in Lucid is at this point. You are not buying a car company. The automotive manufacturing operation, as it currently stands, is a liability, a cash incineration machine with negative margins that would make most CFOs break out in a cold sweat.
You are buying a highly speculative, long-shot bet on autonomous vehicle technology, backstopped by a sovereign wealth fund. The entire valuation hinges on the hope that their partnership with Nvidia and their internal R&D will produce a breakthrough in autonomy that is so valuable it renders their current manufacturing failures irrelevant. It’s a bet that the software of the future can save the hardware business of today. That’s not an investment thesis; it’s a Silicon Valley prayer. The stock isn't cheap because the market is missing something; it's cheap because the risks are astronomical.