Lucid Runs Into Middle-East Misadventure As Saudi Sales Stumble On Scaling Issues

EV maker Lucid Group Inc (NASDAQ:LCID) was banking on sales in Saudi Arabia to improve its delivery numbers. However, the company seems to be struggling in the Middle East as well.

What Happened: Though the company intended to deliver more vehicles in Saudi Arabia in the third quarter, “scale-up time has taken a little longer than estimates,” company CFO Sherry House said in the company’s third-quarter earnings call on Tuesday.

Lucid has a purchase agreement with the government of Saudi Arabia to sell up to 100,000 vehicles over the next 10 years.

The company is now looking to scale deliveries in the fourth quarter. The company has already manufactured 700 EVs and shipped them to Saudi Arabia for final assembly. However, until it completes final assembly, these vehicles are not counted as factory-gated.

Previous Delays: Though Lucid operates in the U.S., it is 60% owned by Saudi Arabia's Public Investment Fund (PIF). The PIF has invested about $5.4 billion into Lucid since 2018. In September, Lucid also opened a new EV manufacturing facility in Saudi.

During the company’s second-quarter earnings call in August, Lucid had said that they intended to deliver a “significant number” of vehicles in Saudi before Eid and summer holidays but were delayed due to supplier issues. These issues, the company then said, were “largely resolved.”

However, the company has now pushed a large part of these expected deliveries further down to the fourth quarter.

Additionally, in an attempt to align deliveries with production, the company is now looking to produce only 8,000-8,500 vehicles this year, down from its earlier projection of over 10,000 units.

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