Lucid's slow deliveries, Saudi stake are focus of Q4 earnings

Lucid Group's stock price remains elevated nearly a month after unconfirmed speculation that Saudi Arabia's Public Investment Fund, which holds a controlling stake in Lucid, could be working on a deal to buy out the rest of the automaker.

Lucid has not commented on the report by deals website Betaville, which characterized the item as market gossip. After the report, Lucid's stock surged 43 percent to $12.87 at the Jan. 27 close. Last week, the closing price was $10.93.

Investors are hoping to hear more on the subject during Wednesday's fourth-quarter earnings call, along with an explanation of why Lucid's vehicle production is significantly higher than deliveries to customers.

Questions submitted to Lucid management by investors, according to the electric vehicle maker's website, also ask about the possibility of Lucid teaming up with Apple Inc. on an electric car and ask for a forecast on when Lucid might become profitable.

The questions are ranked by Lucid investors.

"Is the Saudi PIF taking Lucid private?" was a top-ranked question. PIF refers to the Public Investment Fund.

"Can you explain why we have so many Lucid cars on the lot and not delivered out to customers?" was another one. Lucid sells directly to customers but holds inventory at its Arizona factory.

Lucid reported fourth-quarter production of 3,493 Air sedans, its only model, and deliveries of 1,932. For full-year 2022, the automaker reported production of 7,180 vehicles and deliveries of 4,369.

One retail investor asked the question: "How do you propose to catch up on deliveries?"

While Lucid slightly beat its 2022 production forecast, that estimate was cut from its original forecast of 20,000. The automaker's stock price peaked Nov. 16, 2021, closing at $55.52, before falling steady last year as production lagged.

Investors also submitted questions on Lucid pricing after the company offered sales and lease incentives.

Lucid said on its third-quarter earnings call last year that it had 34,000 reservations for various trims of the Air sedan, which amounted to an extensive backlog. But earlier this month, the automaker announced sales incentives of up to $7,500 on some Air models after EV rival Tesla Inc. cut prices across its four-model lineup.

A change in the federal EV tax credit that took effect Jan. 1 removed the Lucid Air from the list of qualifying vehicles due to new price caps. Tesla's rival Model S also does not qualify for the $7,500 EV incentive, which caps sedan prices at $55,000.

The base Lucid Air model, the Pure trim, starts at $89,050 with shipping compared with the Model S, which starts at $96,630 with shipping.

Some investors also submitted questions seeking more information on Lucid's second model, the Gravity crossover scheduled to launch in 2024. Lucid is expected to open reservations this year.

For Wednesday's earnings report, financial analysts expect Lucid to post another loss for the fourth quarter after burning through billions of dollars in the last two years.

Revenue is expected to rise to $302 million in fourth-quarter 2022 from $26 million in fourth-quarter 2021 on growing Air deliveries, according to the mean earnings estimated from Refinitiv.