Lucid Faces Challenges Despite Some Positive Production News

PALO ALTO, California — Electric vehicle maker Lucid Motors has faced a significant decline in share price since mid-2022, dropping 96% from its peak of around $58. As of June 16, 2025, the stock is trading at $2.25, a stark contrast to its past performance. Investors are left wondering if Lucid can regain its momentum in the competitive EV market.

Despite these challenges, Lucid’s management has announced plans to double vehicle production from the previous year, aiming to manufacture 20,000 vehicles by 2025. “If Lucid can achieve its production goals, we could see some positive movement in share prices,” said one industry analyst.

In the first quarter of 2025, Lucid showed progress with a 58% increase in vehicle deliveries and a 36% uptick in revenue, reaching $235 million. The rollout of Lucid’s new Gravity SUV is also on the horizon; however, with a starting price of around $80,000, it targets a high-end market segment.

Lucid plans to introduce a more affordable midsize SUV called the Lucid Earth, projected to launch in 2026 or 2027, with a potential starting price of $48,000. This model aims to attract more customers in a market where affordability is key, given the average new vehicle transaction price is lower than Lucid’s offerings.

However, the current state of consumer interest in electric vehicles may hinder growth. According to AAA, interest has plummeted from 23% in 2023 to 16%. This decline is attributed to rising vehicle costs and an overall economic downturn.

Additionally, Lucid’s luxury-market focus poses risks, as the lowest-priced Air sedan costs significantly more than the average new car. Management has raised concerns about automotive tariffs potentially affecting gross margins by eight to fifteen percent, compelling the company to consider price adjustments.

The political landscape poses additional challenges, with indications that tax credits and EV infrastructure support may wane. These shifts could significantly impact the mass adoption of electric vehicles, further complicating Lucid’s path to market success.

While Lucid is making strides in production and sales, the road ahead is fraught with hurdles. Industry observers will be closely monitoring its developments as it seeks to navigate these complex challenges.