Lucid Motors, the US-based electric vehicle manufacturer majority-owned by Saudi Arabia’s Public Investment Fund (PIF), has strongly refuted a report claiming it is considering bankruptcy or going private. The rumors triggered the company’s largest single-day share price fall in nearly two years.
Quick Facts
- Stock finished the day 16% lower
- Saudi’s PIF injected $550 million in April
- Lucid confirmed consulting with AlixPartners
- Rumors called “completely false” by the company
Market Reacts to Blog Post
Lucid’s stock price on the Nasdaq exchange dropped by more than 50% on Tuesday before recovering to close 16% down. The sharp decline followed a blog post on eletric-vehicles.com which cited unnamed sources stating the EV maker was engaging with management consultants AlixPartners to explore filing for bankruptcy or going private.
In a statement, Nick Twork, the company’s chief communications officer, told TechCrunch the “rumors are completely false.” He added, “The company has sufficient liquidity to carry its operations well into next year, as recently published in its last quarterly filings.”
Clarifying AlixPartners’ Role
While Lucid confirmed it is working with the New York-based AlixPartners, it clarified the consulting firm’s mandate. The company stated its “focus is on improving execution, strengthening operations, and positioning Lucid to realize the full potential of its technology, products, and innovation.”
Lucid explicitly denied that AlixPartners, which famously advised on General Motors’ 2009 bankruptcy, had recommended such a course of action. Twork stated the firm is assisting Lucid on strengthening its operations and “nothing else and has not recommended bankruptcy to management or the Board.”
PIF’s Continued Backing
The Public Investment Fund remains Lucid’s majority owner and a key financial backer. In April, the Saudi sovereign wealth fund injected an additional $550 million into the company, underscoring its commitment. Lucid, which currently manufactures in the US, has long-stated ambitions to move more of its manufacturing operations to Saudi Arabia. The company’s share price has seen a dramatic fall from a high near $600 in 2021 to just under $5 today.
Restructuring Under New Leadership
The recent market turbulence comes as Lucid undergoes significant internal changes. The company has brought on a roster of new executives over the past two months, including a new chief executive officer, Silvio Napoli. Earlier this year, Lucid also laid off more than 2,000 employees as part of a broad restructuring. The company has struggled to translate its impressive technology into high-volume sales, delivering 3,953 vehicles in the second quarter of this year.
About Lucid Motors
Lucid Motors is a US-based luxury electric vehicle manufacturer. The company is majority-owned by Saudi Arabia’s Public Investment Fund (PIF) and is known for its high-performance electric cars, including the Lucid Air sedan.
Source: AGBI
