Sachin Sharma
Investor, 22+ Years in Oil/Gas/Energy, SLB & MBB Background
Lucid's business model doesn't work because it loses money on every vehicle it sells. x.comÂ
Lucid is not worth a penny, let alone $1 billion, without a clear path to profitability on limited capex. x.comÂ
Lucid has a solid catalyst in Saudi Prince Alwaleed bin Talal taking a 5% stake, and low-float names like it can rip hard when big money steps in. x.comÂ
Rivian's R2 is going to flop, because once a carmaker goes low cost it is game over. Rivian is burning massive cash while the auto market weakens fast on rates and inflation, and its $21B market cap should be closer to Lucid's. x.comÂ
Lucid looks to be in serious trouble after reports it hired AlixPartners, one of the world's biggest Chapter 11 restructuring firms. It has not filed for bankruptcy, and Lucid called the rumors false, citing liquidity well into next year, but hiring such a firm suggests otherwise. Elon Musk has long warned Lucid is tracking toward bankruptcy, and building millions of EVs at scale, controlling costs and turning a profit is far harder than designing an attractive car. x.com x.comÂ
Lucid Motors is on death watch, burning cash with massively negative gross and EBITDA margins. It ended the quarter with $714M of cash after negative free cash flow of $1.4B, and had to raise another $1B from its Saudi backers. x.comÂ
Lucid is probably headed to zero, and Uber's $300 million bet on it, a moonshot to eventually compete with Waymo and Tesla in fully autonomous driving, looks like money tossed at a failing company. Yahoo Finance reports Lucid shares plunged on reports it is weighing going private or Chapter 11. x.comÂ
Rivian is next in line for trouble once investors stop funding its cash-burning business. Lucid's stock fell 48% to an all-time low after a report that it is considering going private or filing for Chapter 11; Lucid had not commented. x.comÂ
Lucid's denial of a bankruptcy rumor is not reassuring. Lucid said it has sufficient liquidity, formed no special board committee and that AlixPartners did not recommend bankruptcy. But as @wholemars notes, you don't call AlixPartners when things are going well, and hiring a restructuring firm for routine cost optimization, rather than firms like BCG, McKinsey or Bain, raises doubts. x.com x.com x.comÂ
Lucid is dead money as the EV hype cycle and subsidy tailwinds fade, especially under the Trump administration. Tesla is the only dominant EV player, and Rivian may survive long term only with near-flawless execution; everything else, including Lucid, is dead money. x.comÂ