What do you get after a decade of negative real rates and unlimited QE as monetary policy? Losing $227,000 per vehicle as an acceptable business model for an automobile company!
At least that’s the case over at Lucid, according to a new writeup from the Daily Caller.
The California-based Lucid Motors, offers four electric vehicle (EV) models priced between $74,900 and $249,000 and reported a third-quarter net loss of $630.9 million, excluding overhead costs.
This amounts to over $227,000 in losses per car sold, the report says, citing its financial statements and calculations by The Wall Street Journal.
Despite having sold only 125 vehicles by November 2021, the company’s valuation peaked at $91 billion. However, its stock price has since dropped by approximately 93%.
Last week, Lucid Motors reduced its vehicle prices to boost demand, the report notes. All the while, the electric vehicle company’s primary investor is the Saudi Arabian public investment fund, ironically sustained by oil revenues.
The Saudi government plans to purchase 100,000 Lucid cars over ten years, with the fund investing heavily to support the struggling company, the report added.
Lucid is not alone in its financial struggles within the EV sector. Rivian, another upscale EV maker, faced a loss of $33,000 per vehicle sold in the second quarter. Meanwhile, Ford, a traditional automaker, anticipates over $4 billion in losses from its EV division this year.
All this completely rational, sensible behavior and market mechanics in the name of climate change…