Key facts
- Lucid Motors has delayed the launch of its affordable electric vehicle, the Cosmos, to the second half of 2027.
- The decision aims to prevent quality issues that have affected previous Lucid models.
- CEO Silvio Napoli is implementing significant cost-cutting measures, including workforce reductions and executive changes.
- The company expects to achieve $1.4 billion in savings by year-end.
- Lucid anticipates building and selling fewer vehicles this year than previously projected.
- Lucid has sufficient liquidity to operate into 2027.
Lucid Motors has announced a significant delay for its upcoming affordable electric vehicle, the Cosmos, pushing its launch to the second half of 2027. This decision, according to new CEO Silvio Napoli, is a strategic move to address and rectify the quality control issues that have plagued the company's existing, more expensive models like the Gravity SUV and Air sedan.
Napoli, who took over as CEO in June, is undertaking a comprehensive restructuring aimed at improving execution and financial stability. This includes a significant reduction in workforce, with 18% of employees laid off in June following an earlier 12% reduction, and a cancellation of a second shift at its Arizona factory due to lower-than-expected demand. The company is also streamlining its leadership structure, replacing multiple executives and aiming for $1.4 billion in cost savings by the end of the year.
The Cosmos, intended to start under $50,000, was seen as a crucial model for Lucid to expand its customer base and increase sales volume. However, Napoli expressed concern that a rushed launch could repeat past mistakes, leading to the decision to delay. The company has assured investors it has sufficient liquidity to operate well into 2027 but has also revised down its vehicle production and sales forecasts for the current year, which contributed to a more than 15% drop in its stock price.
Despite the production delays, Lucid's planned robotaxi service with Uber and Nuro remains a top priority. Uber has placed substantial orders for Lucid's Gravity SUVs to be retrofitted with autonomous technology and has also ordered 25,000 robotaxis based on Lucid's mid-size platform, with production expected by late 2028. Uber CEO Dara Khosrowshahi voiced support for Napoli's strategic reset, highlighting the long-term commitment from Lucid's majority owner, Saudi Arabia's Public Investment Fund.