I'll tell anyone who will listen that the Lucid Air is, in my humble estimation, pretty much the best electric vehicle you can buy in America today. The only problem is that it's an expensive electric luxury sedan tasked with keeping a promising startup afloat at a time when the market is moving away from all of those things. Some help is finally on the way in the form of the Lucid Gravity SUV, but it too arrives at a moment of profound uncertainty.
Can the family-friendly Gravity move the needle for Lucid Motors in 2025 and beyond? We'll look at that on today's edition of Critical Materials, our morning roundup of industry and tech news. Also on tap today: South Korea has been cooking up a battery boom in the U.S., but now it's getting nervous about its prospects under the incoming Trump administration, and Rivian's stock price seems poised to end 2025 on a high note. Let's dig in.
30%: Defying Gravity
Production of the Lucid Gravity officially kicked off last week at the startup's Casa Grande, Arizona factory, making good on a promise to do so before 2024 drew to a close. Lucid Motors' CEO Peter Rawlinson marked the occasion with these social media posts showing the first car driving off the assembly line:
It's hard to overstate just how much Lucid needs this car—and needs it to be a success. The California-based EV startup, now majority-owned by Saudi Arabia’s Public Investment Fund, has done about all it probably can for now with the Air sedan and its starting-at-$70,000 price tag. Now it needs more mainstream models that can appeal to a wider audience, which will hopefully pay the bills until it can get more affordable mass-volume EVs on the road. If you think of the Lucid Air as a stand-in for the Tesla Model S, then the Gravity is the Model X until Lucid's "Project Midsize" can effectively become its Model Y.
Except I'd wager that the Model X was never quite the hit Tesla wanted it to be, and Lucid has no room for error at this point in its rise. Here's the latest from Automotive News on its financial situation:
Lucid needs the Gravity to be a hit, analysts said. The EV maker reported a third-quarter net loss of $950 million. That was wider than its second-quarter net loss of $790 million and its first-quarter net loss of $681 million. Lucid is majority owned by Saudi Arabia’s Public Investment Fund. The company said in its third-quarter earnings report that it had $1.9 billion in cash and cash equivalents as of Sept. 30.
Lucid’s stock price was down by about 50 percent from the start of the year to its closing price Dec. 5.
And then there's the question of price. The three-row Gravity will commence sales with the fairly loaded Grand Touring trim, and that will mean starting at $96,550 out of the gate. More affordable versions are expected to roll out but not until late 2025, and it's unclear if customer deliveries will start next year or in the remaining weeks of this one. Whenever that starts happening, we'll be looking closely at whether Gravity sales can propel Lucid to a more stable financial footing and prove to be a winner with buyers.
On its own, the Gravity seems to be a very impressive SUV; I've only sat in a few examples at auto shows so far but it's quite the stunner. The Grand Touring will pack an outstanding 440 miles of range as well. We'll have more on InsideEVs this week about what to expect from Lucid's next act.
60%: Korea's $54 Billion 'Battery Boom' In The U.S. Looks Uncertain Under Trump
Recent unpleasantness aside, America has every reason in the world to want to keep South Korea as a good friend. It's a crucial trading partner, a like-minded ally in a region increasingly dominated by China and a huge technology investor in this country as well. South Korea's battery expertise and industry are probably second overall to China's (albeit a very distant second, unfortunately) so the U.S. does need its help to catch up there.
Yet the copious battery plant investments in the U.S. from companies like LG, SK On, Samsung and various suppliers are starting to look a little uncertain if the incoming Trump administration does in fact revoke the Inflation Reduction Act's EV tax breaks and other subsidies. Here's Bloomberg to explain:
Some Korean companies have slowed or hit the pause button on any ongoing construction of some plants because they’re concerned about reduced demand for EVs and what Trump would do during a second term in the White House, people familiar with the matter said, asking not to be identified due to the sensitivity of the issue. Posco Future M, which makes cathodes for General Motors Co., said in a filing in September that it is delaying the completion of its plant in Quebec due to “local conditions.”
Although companies haven’t taken any action yet, many are “anxious” about to what degree Trump would slash government incentives for the EV market, said Kenny Kim, chief executive officer at SNE Research, a Seoul-based research firm that focuses on Korean battery makers.
Ending hundreds of billions of dollars in subsidies, tax credits and other incentives would threaten tens of thousands of US jobs and undo years of work shifting the global EV supply chain away from China. It could also hit the earnings of Korean firms, key US partners in the effort to reduce reliance on Chinese suppliers, at a time when they’re already suffering from weaker demand for EVs and falling battery prices.
And then there's the problem with China. Trump's calculus there could be quite different from Biden's, including allowing more of that country's battery plants to invest here as part of some kind of broader trade deal. This would be devastating to such an important U.S. ally:
Korean companies also worry Trump might allow Chinese battery companies to enter the US. China’s Contemporary Amperex Technology Co. Ltd, or CATL, said it will consider building a US plant if Trump opens the door, Reuters reported last month.
The IRA has so far blocked investments from China, asking carmakers to gradually reduce sourcing critical battery minerals from “foreign entities of concern.”
“China’s entry to the US would be a disaster for Korea,” said Park Chulwan, a professor in the car engineering department at Seojeong University. “Chinese battery firms would offer much lower prices.”
We're in for a very interesting year ahead.
90%: Wall Street Gets More Optimistic About Rivian
But hey, it's not all doom and gloom on the EV front. If you're a fan of Rivian, or have money in the company, things are looking up with its stock price. RIVN has gained quite a bit over the past month amid its investment from Volkswagen, declining sales of electric competitors, a $6.6 billion Department of Energy loan and a healthier overall balance sheet. From The Motley Fool:
Rivian's R1T is one of just a few electric pickup truck offerings. Tesla has entered the market with its unique Cybertruck, but the R1T's biggest competition is arguably Ford's F-150 Lightning. And it's news about the Ford EV that may have had Rivian stock jumping by nearly 10% Friday morning. At 1:55 p.m. ET, Rivian shares still held on to a gain of 4.5%. The move has helped Rivian stock log an increase of more than 20% in the last month.
Last month, Rivian told investors it expects to deliver between 50,500 and 52,000 EVs this year. That would only slightly surpass 2023 deliveries. But the company also recently provided encouraging news related to its future capital position. And it is preparing to start production of its next-generation R2 platform next year as well.
That has bolstered the stock recently, and yesterday it got another boost when Ford released its November vehicle sales update. That's because sales of Ford's F-150 Lightning plunged by 17% last month year over year.
Still, Rivian is a long ways off from the launch of the R2. We'll see how it can keep this momentum going in the meantime.
100%: What EV Maker Are You Most Optimistic About?
Traditional, startup or even Chinese: Which company or companies do you think have the juice in 2025 and beyond? Let us know in the comments below.
Contact the author: patrick.george@insideevs.com
