There’s no denying that electric vehicle manufacturer Lucid Group (NASDAQ:LCID) offers attractive and luxurious cars. It might tempt some financial traders to go on a bottom-fishing expedition with LCID stock.
This doesn’t mean that these vehicles are strong sellers, though. The best policy is a cautious one, however, as Lucid Group’s EV delivery outlook is unclear.
Lucid Group CEO Peter Rawlinson certainly knows how to stir up hype and interest in his company. Being a good pitchman is fine, as that’s part of what an effective chief executive does.
Yet, sensible investors must weigh an executive’s braggadocio against what the data says. With Lucid Group, keep robust expectations in check as the automaker’s past performance hasn’t been stellar.
| LCID | Lucid Group | $7.55 |
Big Talk From Lucid Group’s CEO
Not long ago, Rawlinson declared that the Lucid Air “redefined the luxury sedan category.” Did it really, though? It’s easy to toss around words like “redefine,” but it’s only meaningful if there’s concrete data to back up Lucid Group Rawlinson’s assertions.
Remember, Lucid Group only “produced 2,314 vehicles at its manufacturing facility in Arizona” during this year’s first quarter. So, strictly speaking, Rawlinson’s assumption that Lucid is “on track to produce over 10,000 vehicles in 2023” might not be true.
Besides, the 10,000 vehicle production outlook isn’t particularly ambitious. Lucid Group had previously guided for current-year production of 10,000 to 14,000 vehicles. The most alarming statistic, however, is that Lucid only “delivered 1,406 vehicles during the same period.”
This makes it difficult to accept that the Lucid Air “redefined” any vehicle category. Lucid Group’s first-quarter 2023 ratio of produced to delivered vehicles is 61%, and that’s not anything to brag about.
Upcoming SUV Won’t Rescue LCID Stock
In a recent update, Rawlinson doubled down on his assertion that the Lucid Air redefined the sedan category but then added new comments. In particular, the CEO dared to declare that the upcoming Gravity vehicle launch “is positioned to change the world of SUVs.”
That’s a bold statement, to say the least. Unfortunately, Rawlinson didn’t mention the expected starting price of the Gravity SUV.
The launch of this vehicle model won’t happen until 2024, though Lucid Group mentioned that the Gravity SUV is “now testing on public roads throughout the U.S.”
Only time will tell whether automotive buyers actually care about the Gravity SUV’s “new Glass Cockpit high-resolution displays.” Lucid Group really needs to knock it out of the park with this SUV. And by “knock it out of the park,” we don’t only mean producing a lot of Gravity SUVs.
Lucid Group needs to actually sell large numbers of Gravity SUV in order to convince Wall Street that the company is in turnaround mode. That’s a tall order during a time of high inflation and fierce competition in the EV space.
Don’t Make a Hasty Trade With LCID Stock
Prospective investors really need to be careful now. They shouldn’t expect any miracles to happen with the Gravity SUV launch. Besides, that event won’t likely happen until 2024.
Lucid Group’s chief executive certainly has a flair for hype and robust language. That’s not necessarily a bad thing, but the data doesn’t necessarily back up Rawlinson’s confidence.
Ultimately, Lucid Group still has to demonstrate EV delivery growth this year and next year. In the meantime, it’s fine to steer clear of LCID stock and just watch it from a safe distance.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.