It may be hard to believe that Lucid does not have a presence in China, the world's largest market for electric vehicles, but that's the way things stand at the moment.
The US EV startup currently sells its Air luxury sedans in the United States, Canada, and several European countries. That said, Lucid Group is preparing to enter the world's largest auto market, the company's newly appointed head of China operations Zhu Jiang said today.
According to Reuters citing a person familiar with the matter, Lucid will sell imported cars in China – no timeline for the launch was provided – but it is also considering local production in the country.
While Zhu confirmed to the news agency that the company is preparing to enter the Chinese market, he declined to comment on any plans for local production. Zhu Jiang previously worked at Jidu Motor, the EV arm of Chinese tech giant Baidu, and was Ford's Mach-E project leader in China before that.
Last week, Lucid announced plans to raise about $3 billion though a stock offering, with nearly two-thirds of the money expected to come from its largest shareholder, Saudi Arabia's Public Investment Fund (PIF).
Gallery: 2023 Lucid Air Pure
In the announcement, the company said the funding would help it "bring the advanced EV technology and product experience to the industry and users globally at a faster pace." As it turns out, part of the funds will be used for the expansion to China. "China is also looking forward to it," Zhu told Reuters.
Lucid is currently struggling with increasing losses and dwindling cash reserves amid recession fears and a price war sparked by Tesla.
Last month, the EV startup posted a first-quarter net loss of $780 million and a lower-than-expected first quarter revenue of almost $150 million. It also cut its 2023 production forecast to "more than 10,000 vehicles" from its previous estimate of 10,000-14,000 vehicles.
Another sign of waning demand is that Lucid delivered only 1,406 vehicles in Q1 despite building 2,314 units during the same period. The discrepancy between production and deliveries has been going on pretty much since Lucid manufactured its first Air EV in September 2021.
The expansion to China will likely help Lucid sell some of its surplus inventory of Air EVs, but a lot will depend on the pricing strategy in the highly competitive market. In the US, Lucid has avoided lowering prices on its Air luxury sedan, which starts at $89,050 in base Pure trim (including shipping).
